How to Transfer Money from a Trading Account to a Bank Account?

Every individual wants to make huge profits in the stock market, but all the profits earned remain in the trading account, which you can’t spend. One must transfer these funds to the bank account to spend it, but you might wonder how to transfer money from a trading account to a bank account and vice versa.

Transactions between a trading account and a bank account could be depositing funds for investment or withdrawing profits after highly successful trades. This article will describe the funds transfer procedure in detail, including different modes of transferring funds and things to remember while transferring funds.

What is A Demat Account?

A Demat account is short for a dematerialized account, which allows investors to hold their securities in electronic form. It simplifies the selling and buying processes of shares and other securities and doesn’t require investors to hold onto physical certificates.

The securities are held in your Demat account, while the trading account is used to place buy or sell orders on the exchange. Trades can be executed using the funds in the trading account, and upon successful execution, shares are either credited or debited to your Demat account. Hence, a Demat account plays a significant part in your investment journey by helping you manage and keep your investments safe.

How to Transfer Money from the Bank Account to the Trading Account?

If you need to fund your trading account before the trading session commences, here’s how you can transfer money directly from your bank account to a Trading account using the trading platform:

• Login to Your Trading Account

Open the mobile application or website of the DP and login using your credentials.

• Go to the Funds Section

Find the “Funds” or “Add Funds” section. This section will allow you to transfer funds from your bank account to the trading account.

• Select the Linked Bank Account

You can link multiple bank accounts to your trading account. Select a bank account from which you want to transfer the funds to your trading account. 

• Enter the Amount

Enter the amount you want to transfer from your bank account to your trading account. Most platforms allow for instant transfers using net banking or UPI.

• Confirm Transfer

Proceed and enter relevant authorization information to confirm the transaction. The transferred amount will appear in the trading account balance.

Read Also: How to Close Your Demat Account Online?

How to Transfer Money from a Trading Account to a Bank Account?

If you have earned some profit or feel like withdrawing funds, you can follow these steps to withdraw money from a trading account and transfer it to your bank account:

• Log in to Your Trading Platform

Start by logging in to your trading platform. Navigate to the “Funds” section.

• Select Withdrawal

Click on “Withdraw Funds.” The system will then show the maximum available amount you can transfer from your trading account to your bank account.

• Enter the Amount You Want to Withdraw

Enter the amount you wish to withdraw and deposit into your bank account. Make sure that this amount is not more than the available balance of your trading account.

• Choose Linked Bank Account

Choose the bank account you already have linked with your trading account for a withdrawal.

• Confirm the Transaction

Confirm the withdrawal, and your DP will ensure this amount is reflected in your bank account within 24 to 48 hours.

Different Modes to Transfer Funds

While transferring funds between your bank and trading accounts, you have the following options before you:-

• UPI Transfers: UPI transfers are quick, and most trading platforms offer this facility. You can just click on the UPI tab, approve the transaction through your UPI application, and transfer funds instantly.

• Payment Gateway: Investors can transfer funds using their debit card or their bank’s internet banking portal. However, some brokers may charge a fee for using the payment gateway mode to transfer funds.

• NEFT/RTGS/IMPS: These traditional modes of banking transfers guarantee a safe transfer of funds. NEFT and RTGS are preferred when investors want to transfer huge amounts of capital, whereas IMPS is used for instant transfers.

Tips to Remember During Fund Transfer

When transferring funds from your trading account to your bank account, or vice versa, there are certain issues that you should consider to avoid delay or complications involved in such processes:

• Processing Times: Fund transfer usually takes place in an instant, especially with UPI or NetBanking, but withdrawal requests may take up to 48 hours, depending on the processing time of a particular broker.

• Transaction fee: Some DPs charge fees for adding and withdrawing funds. Make sure you review any applicable charges with your broker before you initiate the transfer.

• Minimum and Maximum Withdrawal Amount: Trading platforms often impose limits on the amount that can be withdrawn on a daily basis. Be aware of these limits to avoid any delays.

• Accurate Account Details: Make sure you input the correct details while making fund transfers.

Read Also: How to Transfer Shares from One Demat Account to Another?

Conclusion

Every investor must understand the process of transferring money from the trading account to the bank account and vice versa. You can withdraw money from your trading account or transfer money to your trading account easily by following the steps listed above. Investors must be cautious of the processing times, transaction fees, and withdrawal limits imposed by the brokers to avoid any hassle.

Frequently Asked Questions (FAQs)