What is Beneficial Owner Identification Number (BO ID)? and its Importance

Last Updated: 16 Aug 2024

A Demat account is a type of dematerialised account used to keep electronic assets, such as money, equities, bonds, choices, and mutual funds. It helps maintain track of every transaction a person makes, including buying and selling stocks, bonds, mutual funds, and other assets.

Let’s delve into what is BO ID and other details:

What does BO ID mean in the share market?

BO ID full form is known as the Beneficial Owner Identification ID. It is a unique identifier provided to Demat account holders maintained with the CDSL. For all Demat account-related operations, the BOI ID provided by the Depository Participant (DP) is used to identify the Demat account holder. To prevent unauthorised access to the Demat account, the owner of the Demat account has to keep the BOI ID private and not expose it to anyone else.

As it is for the NSDL depository, the Demat account number starts with “IN” and is followed by a fourteen-digit number code. The BOI ID in share market is a 16-digit alphanumeric code reserved for each Demat account holder, with the first eight digits expressing the DP ID with CSDL and the last 8 indicating the client ID. It tracks who owns what stocks and how they circulate inside the Demat account.

How Can a Demat Account Be Launched? 

You can simply open a Demat account by entering a bank, financial institution, or brokerage business that is a SEBI-registered DP. Find all SEBI-accredited DPs by visiting the CDSL or NDSL website before selecting a reliable broker. Lastly, do these actions to open the Demat account.

• Fill out the form to register for an account.
• Submit a PAN card, an Aadhar card, and passport-size photos to finish the paperwork.
• You may open a Demat account completely online. But the agency could get in touch with you for verification.

How Can You Find Your BO ID?

Now that you know what is BO ID, you might want to find your own. If you have an Angel One Demat account and would like to find the BO ID, please follow these steps:

• Go to Angel Broking or Angel One’s home page. 
• Insert the information needed to log in to access your Demat account.
• Go to the “My Profile” or “Account Information” option after logging in.
• Look for the “Demat Account” or “BO ID” tab within the account details.
• To view the information about your Demat account, click the tab.
• You should locate your BO or Beneficiary Owner ID, in this area. Usually, it is an alphanumeric code of 16 digits.
• For future use or any transactions associated with your Demat account, write down your BO ID.

How is a BO ID created?

To get your BO ID, you must take the below actions:

• Select your DP: The BO ID is produced when you open a Demat account with a broker or depository participant (DP) in a common language. Select the appropriate brokerage firm as your DP if you want to get your BO ID. Findoc can assist you because it provides various brokerage services that you may utilise to create a BO ID.
• Opening a Demat Account: After selecting your DP (for example, Findoc), you must open the Demat account. To apply for a Demat account, you must provide some personal information, including your name, address, occupation, income, and other facts.
• KYC: The following action is to upload all the papers you need to establish an account and verify your KYC. You must upload bank statements, photos, AADHAAR, PAN, and other papers.
• Agreement: Following completing the KYC, you will get an agreement to sign. By doing so, you confirm that you comply with the terms and conditions of the DP for creating a trading and Demat account.
• Make payment: To complete the account opening process, you must pay any applicable account opening fees. Isn’t it wonderful that Findoc allows you to establish a Demat account online for free and only pay a one-time maintenance charge to keep it operating?
• Receive your BO ID: After completing the aforementioned procedures, your Demat account will go live and you will receive a BO ID via the email address you registered with.

Why is BO ID so important? 

A Demat account holder’s BO ID is essential in many ways. Let’s understand each of them individually:

• Firstly, the Demat account holder can track all of his investments both online and offline with the BO ID. In addition to monitoring the portfolio’s worth, he or she may keep tabs on every transaction made within the account.
• Secondly, it brings us to the account holder’s and the portfolio’s safety quotient. Cybercrimes are on the rise, and Demat accounts are not exempt. However, the risk of online fraud is significantly reduced as BO ID allows you to monitor every transaction made in the account.
• Thirdly, save your transaction records online using a BO ID. You are not required to keep a diary or any other actual documents. This simplifies and speeds up all of the procedures.
• Every trader and investor should be conscious of the restrictions of BO ID, even if it is a beneficial tool.
• For example, a Demat account created with NSDL will have a different BO ID than a Demat account opened on CDSL.
• Then, without using the Demat account, this ID cannot assist in tracking any actual trading or investments made.
• Another important problem is that BO ID depends only on the DP, thus picking the appropriate brokerage house to register a Demat account with is crucial.

Advantages of Beneficial Owner Identification (BO) ID

The following are a few advantages of Beneficial Owner Identification (BO ID):

• Simple investment access: You may monitor your portfolio and access your online assets with ease if you have a BO ID. Including information on the stocks you own, past transactions, and dividends you’ve earned.
• Transferring securities across accounts: It is quick and simple with its help. Time savings and a lower possibility of fraud or mistakes will result from doing this.
• Promotes internet-based trading: It serves as the investor’s unique ID in the electronic trading system, making it crucial for online trading. It assists in preventing fraud by ensuring that trade is only carried out by authorised individuals.
• Takes away the risks of physical certificates: Physical certificates come with dangers of loss, theft, or damage that can be avoided by using this method. Additionally, it lessens the likelihood of fraud.
• Record-keeping is made simpler: Maintaining precise investment records, including transaction histories and dividend receipts, will be made easier for you with its assistance.

BO ID Limitations 

The following are limitations connected with the Beneficial Owner Identification Number:

• Restrictions to depository systems: Only depository systems in India, such as NSDL and CDSL, use it. It does not cover Investments outside the depository system or tangible securities.
• Dependence on a depository user: Its assignment is made by the Depository Participant (DP). Therefore, to update your information, like your address or contact data, you will need to rely on the DP. You may experience inconveniences from any delays or mistakes in the information update.
• Hacking and data loss risk: Because it is used for online trading and investment information access, there is a higher chance of hacking and data theft. As a result, you must take the appropriate safety measures as an investor to protect your BO ID and other sensitive data.
• Restricted application for transactions performed offline: It is irrelevant to transactions that need paper documents or are conducted offline. As a result, actual documentation like a transfer deed, share certificate, or power of attorney is still required for offline transactions.

Conclusion

Thus, you obtain the BO ID (Beneficial Owner Identification Number) from CDSL (Central Depository Security Limited) when registering a Demat account. Like a bank account, it is also the primary controlling number. To transact in securities in an electronic or dematerialised form, you must have this BO ID.

By using a Demat account, traders may keep records of every transaction associated with purchasing and selling bonds, shares, mutual funds, and other assets. These accounts save customers a lot of time by allowing them to trade digitally without dealing with lots of paperwork. The capacity to purchase and sell assets in an uncertain market might result in large gains.

Understanding what BO ID mean and how it functions during the stock market trip is essential. A beginner or novice in the share market should always have learning tools and request professional advice. By downloading our trading app, you can access valuable resources and guidance.

Frequently Asked Questions

1. What BO ID do you have?

Your Demat account may be uniquely identified by its eight-digit Beneficial Owner Identification Number. Your BO ID may be found by contacting your depository participant (DP) or on your demat account statement.

2. How many digits does a BO ID have?

Eight numbers make up a Beneficial Owner Identification Number. Your unique client ID is represented by the last two digits, while the first six digits are your DP ID.

3. What is CDSL's full form?

Central Depository Services (India) Limited is referred to as CDSL. It’s a repository that makes safe electronic keeping and transfer of securities possible. One of India’s two depositories, along with NSDL, is CDSL.

4. Can You keep more than one security in your demat account?

Yes, it’s possible to hold several securities in a single demat account, including government securities, stocks, mutual funds, etc.

5. Who can sign up for a Demat account?

All citizens, including children, partner businesses, and ownership firms, can apply for a Demat account.

6. Does having a DP make a Demat account holder required?

It is correct that all proprietors of Demat accounts must be Depository Participants (DPs).