What is TPIN in a Demat Account?

TPIN stands for Transaction Personal Identification Number, a special six-digit number used to approve transactions in a Demat account. With a Demat account, you can hold your shares, bonds, and other securities electronically.  

According to SEBI, the share market regulator, investors can only sell their stocks or shares after confirmation. For improved investment protection, CDSL adopted e-DIS verification, which stands for an electronic delivery instruction slip. When equities are sold, this verification is carried out via TPIN. TPINs protect accounts from unauthorised access and fraud. To prevent unauthorised access to your account, you should keep your TPIN confidential and not share it with anyone.  

This blog discusses what is TPIN, the full form of TPIN, how it works and the process of generating it. 

How to Generate TPIN? 

To generate TPIN, investors should have an active Demat account. Once that is in place, they can easily create the TPIN by following these steps.  

• Step 1: The first step is to open the link or profile option that directs them to the official CDSL TPIN generation page. 
• Step 2: Once they are on this page, there will be two fields. In the first field, they need to enter their 16-digit Demat account number, and in the second field, they need to enter their permanent account number (PAN).  
• Step 3: After this, a new screen will appear asking for a one time password (OTP). They will receive this OTP on their registered mobile number and email ID. 
• Step 4: Upon verification, CDSL will produce the TPIN and forward it to the mobile number and email that is registered. 
• Step 5: Once it is received, the investor can navigate the TPIN easily via the app or site of their broker, and the process only takes a few minutes. 
• Step 6: The TPIN needs to be safe and private, as it works like an authorisation code for selling shares. If required, one can reset or regenerate the TPIN anytime by logging into their CDSL account. 

How Does TPIN Work? 

A TPIN is a 6-digit security code used to authorise the sale of securities. Here is how TPIN works: 

• Initiating Transaction: You must initiate the process through the trading platform at the time of selling shares or other securities.   
• Verification of TPIN: You must enter the TPIN to proceed with the transaction. This is important for proper identity verification and authorisation.   
• Secure Transaction: The transaction will be processed after the due verification of your TPIN. The transaction stops if the entered TPIN does not match. This protects your account from any unauthorised access. 
• Regular TPIN Updation: Investors should regularly change the TPIN. This helps to safeguard their Demat account against any kind of potential security threats. 

Importance of TPIN in Demat Account 

A Demat account TPIN adds extra safety to your trading activity. Below is some key importance of having a Demat account TPIN.  

• Prevents Unauthorised Selling: The main purpose of having a TPIN is to safeguard an individual’s Demat transactions. It ensures that no one can sell your shares without your permission. 
• Adds a Second Layer of Verification: It works as an extra security step along with your broker login. 
• Protects Your Holdings During Misuse: Even if someone gets access to your trading account, they cannot place a sell order without the TPIN. 
• Enables Secure Online Payments: TPIN ensures that only the owner of the account is authorising every purchase. 
• Helps Comply with the Rules of SEBI: TPIN enables you to maintain your trading operation within the scope of the security standards of SEBI. 

After understanding TPIN meaning and its importance, let’s now discuss why traders need TPIN.  

Why Do Traders Need a CDSL TPIN? 

Investors cannot buy or sell securities directly. The broker executes trades on their behalf. Earlier, investors provided a power of attorney (POA) to the broker for making the transactions. It granted your stockbroker the authority to execute trades on your behalf. However, this system had a disadvantage.  

According to the regulations, the POA had to be physically signed and sent to your broker for verification. This made it difficult to open a Demat account through an e-sign with an Aadhaar card or other documents. 

The lengthy process was substituted by TPIN. The TPIN system's implementation improved transaction security and dependability while also giving investors more control over their trading. 

This allows investors to transact freely using the CDSL TPIN. So, when you place a trade, it redirects you to the CDSL portal. You can input the TPIN on the portal and authorise your transaction. 

You will be required to provide your TPIN for the following: 

• To manage the sell orders in delivery trading 
• Receiving margin benefits 
• Manage sell orders to get intraday shares in your account.  

TPIN is mainly a security measure that assists in selling securities from within your broker's app or website. 

How to Use TPIN for Selling Shares?  

Let’s now understand how to sell shares from your Demat account. Here are the steps you must follow. 

• Enter the login credentials to access your online trading account. 
• You may also issue a sell order on your Demat account if you have any securities to sell. The sell order will appear as pending for execution as soon as you submit it. 
• CDSL will send you an email or SMS requesting TPIN authorisation. 
• Click on the provided link, then input your CDSL Demat account number. 
• Kindly enter the six-digit TPIN that you already created. With your registered mobile number, you may input the OTP that you got. 
• After the authorisation is finished, the pending sell order will be carried out. 
• When you sell shares, they'll be taken out of your Demat account. The funds will be transferred to your bank account linked to your trading account.  

You can keep track of these transactions by checking your Demat account activity on your stock broker's platform. 

How to Change TPIN? 

It's crucial to understand how to change your TPIN. The following are seven easy steps that will help you secure your account and successfully change your TPIN. 

• Step 1: Log in to the platform of your broker or depository participant, which can be a website or a mobile application. Log in to the DPs portal or the CDSL Portal. 
• Step 2: Once logged in, go to the ‘reset or generate’ section. It is usually located under security settings or a settings account. 
• Step 3: The next step is identity verification. This can be done by providing information such as your email address, mobile number, the number of the mobile number, your Demat account number, etc. 
• Step 4: You will receive an OTP on your mentioned email address or mobile number to validate the details. 
• Step 5: Enter the OTP to verify the details and proceed. 
• Step 6: Next, you must set up a new TPIN. It is recommended that you select a TPIN which is difficult for others to guess.  
• Step 7: Finally, a confirmation message or mail will be sent to your mail and mobile number with the new TPIN. This is your final confirmation that the TPIN has changed. 

Quick Tips for Using TPIN Smoothly 

Below are some tips which one may follow while using TPIN. 

• Keep your TPIN private and avoid sharing it with anyone. 
• Save or bookmark the electronic delivery instruction slip for faster access. 
• Make sure to authorise your sell orders early if you expect multiple transactions. 
• Reset the TPIN instantly if it has been exposed. 

Conclusion 

TPIN is a numerical code used to verify transactions while selling securities. The TPIN adds an extra layer of security to the Demat account. It prevents fraud and ensures that only the account holder can make transactions using the trading app. The TPIN must be kept very confidential. Investors should immediately change their TPIN if it is compromised. Greater security, convenience, defence against unauthorised access, control over transactions, and ease of use are all benefits of having a CDSL TPIN in a Demat account.