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Under the Depositories Act of 1996, what process must shares undergo to be held in electronic format?

1. Securitization
2. Monetization
3. Dematerialization
4. Digitalization

Correct answer: Dematerialization

Solution

Dematerialization is the process of converting physical share/security certificates into electronic form, maintained in a depository (NSDL/CDSL) demat account. Governed by the Depositories Act 1996.

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