I had only good things to say about ICICI Direct until I ran into a problem and had to contact their customer service! Well, the less said about my experience, the better! But that’s what I’m here for, isn’t it?
So here’s the story. When I opened an account with ICICI Direct, I did so because their website is the most easy to use for starters. Everything is very well organised into different, relevant sections and adequate explanation is given. The speed is also decent.
I had heard that their website loads very slowly (or doesn’t load at all) in peak conditions, but that doesn’t really matter to me since I don’t indulge in day trading or BTST trading. I buy shares based on long term recommendations, take delivery and sell when my target is met, or when I don’t see any potential in the company’s future.
I also know that their brokerage is probably the highest in the industry, and the ease of use doesn’t entirely justify the excess charges. But I don’t trade frequently or in large volumes, so this was fine too.
So then what went wrong? Well, a few months back I changed my name legally through an affidavit. I got my passport, PAN card, ration card, etc. updated without any hitches. Ditto for bank accounts (including my ICICI Bank account linked to my demat account). Of course, I had to endure some frustration because some people were unaware of the procedures or were casual in their work.
But the guys at ICICI Direct just took the cake! No one – and I mean no one – knows exactly the procedure to change the account holder’s name on a demat account. I came to know from NSDL’s website (not from ICICI Direct) that the account holder’s name cannot be changed on a demat account (why, I don’t really know). A new account has to be opened and the shares transferred to it. But the ICICI Direct folks didn’t know the exact procedure to go about it. One even said that the name can be changed on the existing account!
Specifically, I have the following questions:
- Will there be any issues while creating the new demat account with my new name before closing my old account? This is because my PAN number is the same, only my name has changed. And as per SEBI guidelines, no individual can have two accounts with the same DP. And it’s a known fact that PAN verification is part of the account opening process.
- If yes, then clearly I need to close my old account before the new one can be opened. In that case, where will my shares be stored in the interim? To this, one representative said that only the trading account would be closed and a new one opened, and that the demat account would remain the same. So no need to transfer the shares anywhere. However I didn’t find this a convincing explanation, and he didn’t seem too sure either.
- It seems that mutual fund units bought through my demat account can’t be transferred. Why is this so?
Can someone (preferably from ICICI Direct) please clarify the procedure for me, and for others like me? Not that it matters anymore, because my patience ran out finally and I opened a new demat account with Sharekhan. I will be transferring all my shares to it in the next few days.
Sorry ICICI Direct, but incompetence doesn’t pay in the long run!
UPDATE – MouthShut impact:
So it seems ICICI Direct is listening to customer reviews posted on MouthShut.com. Well, that’s nice! Two days after I posted this, I got a call from an ICICI Direct representative named Ms. Sunitha. She apologized for the problems faced by me and assured me that they are taking steps to prevent a recurrence. She also sent me an email with the exact steps to be followed to change the name on my demat account, and said that I can contact her anytime if I face any further problems with this. She also answered my query on transferring/updating name on mutual fund units.
Here’s the full text of her email sent to me:
Dear Mr. Padiyar,
We value your relationship with ICICI Securities Limited. We refer to your complaint posted on site regarding name change in demat account and trading account. With regards to the same and further to our telephonic conversation on August 12, 2008, we would like to mention that as per NSDL guidelines, the name cannot be changed in the demat account. However, you can open a new demat account and transfer the shares from existing demat account to new demat account. Please fill the attached “Transfer Cum Closure“ letter once demat account is opened.
For name change in ICICI Direct account:
You need to submit an name change application along with proof of name change at the below mentioned address. For linking of new demat account to trading account, you need to fill POA (Power of Attorney) and is available at any ICICI Bank branch offering Demat services.
For name change in Mutual Fund units
You need to submit an name change application for each mutual fund folio along with proof of name change at the below mentioned address.
Ms. Sunitha Dasari / Mr. Rakesh Seth
Shree Sawan Knowledge Park,
Gr. Floor, Plot No. d-507, T.T.C Industrial Area,
M I D C, Turbhe, Near Juinagar Railway Station,
Navi Mumbai: 400 706
We regret your disappointing experience. Every effort is being made to ensure that such an instance does not recur. For any further guidance related to the same, you can contact us on 4070xxxx.
ICICI Securities Limited
Thank you, Ms. Sunitha and ICICI Direct. Hope you read this too :-). And thanks a lot to MouthShut too! You rock!
UPDATE – Useless advice?
The advice provided by Ms. Sunitha Dasari turned out to be pretty much not useful. I went to the nearest ICICI Bank branch to apply for a new demat account and close my demat account after transferring the shares. He said that I cannot open a new demat account with ICICI Bank before first closing the old one. So I asked where will I keep my shares if I close down my old demat account before opening the new one?? To this he had no answer. So I just had two choices:
1. Sell all my shares and close the demat account (not possible in current recession scenario)
2. Transfer my shares to my new Sharekhan account and close this account
I chose the second option. I had opened a new demat account with Sharekhan, so I asked ICICI Bank to transfer my shares there and close my account. I also gave them a copy of my new account’s Client Master list, so that they shouldn’t charge me for transferring the shares to myself. But still eventually they charged me about Rs. 1000! What crooks!
Secondly, it seems that once you close the demat account, the linked ICICI Direct trading account will expire after six months. Now, I have some mutual funds purchased through ICICI Direct. And after
closing the demat account, I wasn’t even able to view my mutual funds, since that requires an active demat account (even though the MFs aren’t stored on the demat account!!!). What a headache…
So I went to the nearest ICICI Direct office and asked them what to do. They said that all my MF units will get converted to material form and I will get the statements like regular MFs purchased offline. However, it’s been several months and I haven’t got any statements. Need to follow up with them.
Now, at least I need to follow the procedure given by Ms. Dasari for name change of trading account and MF units. Let’s see.
UPDATE: Some More Useless Advice…
After my previous update above, I again got a call from Ms. Dasari regarding this issue. She asked me to provide whatever documents I can regarding my name change, and said she would get my name updated on my ICICI Direct account as well as the MF units held by me.
I was so happy! Finally, a solution! I promptly got all the requested documents ready. Those included:
1. A copy of my new PAN card verified by the bank (why verified, I don’t know!), for which I had to go to the bank and get their signature and seal on the PAN copy, and
2. Bank statement of my linked ICICI Bank account for the last 3 months. Since ICICI Bank sends physical statements only once a quarter, and since it was nearly the end of the current quarter, it meant that I would have to get original statements from the bank itself by paying for it (Rs. 110).
Anyway, I thought it doesn’t matter, as long as my problem is solved. So I got all the documents ready and couriered them to Ms. Dasari.
After two weeks, I hadn’t heard back from her. So I emailed her again. She said we also need a copy of Gazette Notification of your name change!! I asked her why she had not mentioned this earlier. Also, I don’t have a copy of my name change Gazette Notification, since even for changing my name on Passport, PAN card, Driving License, etc. I never needed it. But she was insisting that without that we cannot update your name, no matter how many other documents you provide!
I think this is bullshit. Firstly, she made me run around and spend my money, for which I got nothing in return. Secondly, I have visited many MF websites, as well as the NSDL website. All of them say that any one of the name change Affidavit copy OR the Gazette Notification is enough to update the name. None of them insist on Gazette copy. So why is ICICI Direct so obsessed with it??
Any answers, Ms. Dasari?
P.S. I plan to approach the Consumer Court for this harassment soon, once I have some time to spare.