Write notes on the following: Immobilisation and dematerialisation

Immobilisation of securities occurs when physical security certificates are stored or lodged with depository for safe custody. All subsequent transaction in these securities takes place in book-entry form. The actual owner has the right to withdraw their physical securities as and when desired. The immobilization of fresh issue may be achieved by issuing a jumbo certificate representing the entire issue in the name of depository, as nominee of the beneficial owners. Dematerialisation is the process by which shares in the physical/paper form are cancelled and credits in the form of electronic balances are maintained on highly secure systems at the depository. This type of system is cost effective and simple and has been adopted in India.