PIN-based Authorisation for Selling Stocks

• e-DIS: Electronic instruction used to authorise transfer of securities from a demat account.
• Authentication: SEBI's current framework requires OTP and a PIN/password generated at the depository end for the relevant e-DIS instruction.
• TPIN: CDSL generates a TPIN for e-DIS users and allows it to be changed or regenerated.
• Settlement validity: An e-DIS authorisation is valid for the applicable single settlement number/settlement date.
• Security: The authorisation takes place through the depository's authentication system rather than exposing the TPIN to the broker or DP.

The verification process confirms that you have authorised the transfer of securities from your demat account. This is carried out electronically through the e-DIS or demat gateway mechanism provided by the depository and its participating broker or DP.

For an on-market transfer, SEBI's current investor charter states that you provide details such as the settlement number, ISIN and quantity of securities being authorised. You then authenticate the e-DIS using an OTP and PIN/password generated at the depository end.

For CDSL users, the TPIN is generated by CDSL and used to authenticate e-DIS transactions. CDSL states that the same TPIN can be used each time an e-DIS transaction is authenticated, while a TPIN can also be changed or regenerated through the depository system.

The process can be summarised as:

The exact interface can differ between brokers and depositories, so you should follow the instructions displayed by your broker or DP.

• TPIN + OTP verification:

For an e-DIS transaction, the required PIN or TPIN and OTP are used to authenticate the instruction. SEBI specifies that the authentication credentials are generated at the depository end.

For CDSL, the depository generates the TPIN and sends it to the registered mobile number and email address. You can also request a change or regeneration of the TPIN through CDSL's e-DIS system.

• Verification validity:

The current SEBI investor charter does not describe e-DIS validity simply as “until market close” on the same or following day. Instead, it states that each e-DIS authorisation is valid for a single settlement number/settlement date.

Therefore, you should rely on the settlement details and validity period shown during the authorisation process rather than applying a fixed market-hours rule.

• Setting TPIN:

If you have forgotten your CDSL TPIN, you can request a new one through the CDSL e-DIS system. CDSL also provides an option to change the TPIN.

The OTP used for CDSL's TPIN generation or change process is currently valid for 15 minutes. If it expires, you need to request a fresh OTP.

Through your broker or DP:

1. Place the sell order: Enter the security and quantity you want to sell through your broker.
2. Open the authorisation screen: Follow the e-DIS or demat authorisation prompt displayed by the broker or DP.
3. Review the details: Check the ISIN, quantity and applicable settlement details before confirming the instruction.
4. Enter the TPIN or PIN: Provide the authentication credential generated by the depository.
5. Enter the OTP: Enter the OTP received through your registered contact details.
6. Confirm the authorisation: Submit the details to complete the e-DIS authentication.

SEBI states that the depository validates the authorised details against the transaction and relevant settlement obligations before allowing the transfer to proceed.

Through the depository:

Depositories also provide electronic instruction facilities. CDSL's e-DIS system, for example, allows investors to generate or change their TPIN and authenticate eligible transactions through the depository's interface.

The exact steps can vary depending on whether your demat account is with CDSL or NSDL. Use the process specified by your depository and DP.

1. Open the CDSL e-DIS facility:

Visit CDSL's e-DIS TPIN change facility and select the option to change your TPIN.

2. Enter your BO details:

Provide your BO ID, email ID and mobile number as requested by the CDSL system. Your BO ID is your demat account identifier.

3. Complete OTP verification:

Enter the OTP sent to your registered mobile number. CDSL currently states that the OTP used for this process is valid for 15 minutes.

4. Set the new TPIN:

Enter your preferred new TPIN and confirm it in the required field.

5. Submit the request:

Submit the request to complete the TPIN change. CDSL confirms the updated TPIN through its e-DIS system.

The process above is specific to CDSL. Investors using NSDL should follow the process provided by NSDL or their Depository Participant.

PIN-based authorisation adds an electronic confirmation step when securities are transferred from a demat account. Under the current e-DIS framework, the relevant transaction is authorised using credentials generated by the depository, including an OTP and PIN/password.

For CDSL users, a TPIN is generated by the depository and can be changed or regenerated through its e-DIS facility. The authorisation is linked to the relevant settlement instruction, rather than simply remaining valid until a fixed market-closing time.