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Why Choose Stock Brokers for Opening Demat Account Over Banks?

Investing your money for a secured future is very important. With so many investment options available in the market today, it is often difficult to choose the right one. Some banks offer interesting offers for customers to invest with them. There are brokerage firms that also provide a basket of investment options to choose from.

Why Choose Stock Brokers

So, how should you invest your money? Should you open a Demat Account with banks or stockbrokers? Well, let’s find out.

Investment Opportunities

If you are investing with a bank, the bank will offer you a limited option of investments. It will either provide you with mutual funds of their own or their partners.

But when you open a Demat Account to start investing with a stockbroker, you get more investment options. So, you can invest and have a diversified portfolio, which is not possible when you invest with a bank. 

Investment Returns

When you invest with a bank, since your investment choices are limited, often investors have to pay hidden charges and additional fees on their investments. Investors end up paying higher expense ratios and which in turn can reduce their investment returns.

But when you invest with a stockbroker, since your investment choices are ample, your investment options turn out to be less expensive. Also, you can maintain a diversified portfolio, which automatically reduces the risk of lower investment returns in the future.

Trading Charges & Fees

There are no standard trading charges when you invest with a bank. In comparison to a stockbroker, banks charge more trading fees. So if you are looking to invest in the stock market and trade regularly, you can open an account with a reputed Discount broker online as the brokerage charges are quite less. Nowadays most stock brokers are waived off the amc charges and Demat Account opening fees for the new investors.

But, if you want additional market tips to invest in stocks/mutual funds, along with low brokerage charges, you can open an account with Full-service brokerage firms online.

Dedicated Trading Platform

Banks are financial institutions majorly dealing with the customer’s money for deposits and providing loans with nominal interest to deposit holders. Trading and investment facilities are additional services by a bank. So, the chances of developing a trading platform or app just for trading are secondary.

However, brokerage firms explicitly deal with stocks, mutual funds, and bonds. So not only will you receive a dedicated trading platform or app, but also better service and customer support than banks. 

Investment Advice

Due to limited investment options in a bank, there are chances to get biased advice from the investment advisor. However, when you invest or trade through a brokerage firm online, you can choose to invest according to your financial goal. You can be in total control of your investments and also learn about the market simultaneously.

Such as in Investica, you can set your own financial goals and choose what’s best for you with the help of Optimo. While in Jiffy, you can get an automated AI-based research strategy and regular stock recommendations to trade easily. 


To open a Demat Account for investing, you can either do it with a bank or a reputed brokerage firm. However, it is better to open a Demat Account with a reputed brokerage firm, as their platforms and technologies are more user-friendly than banks. They also have more experience than banks.

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