Two factor authentication of demat account will be made mandatory from October 1.
Demat Account Alert: If you invest money in the stock market and invest in shares, then you will definitely have a demat account. Transactions cannot be done in the stock market without a demat account, but from October 1, two-factor authentication of the demat account will be made mandatory. According to a notification issued by the National Stock Exchange (NSE) in June, investors must do two-factor authentication of their account before September 30 to keep their demat account operational. If someone does not do two factor authentication of his demat account before 30th September, then his account will be locked.
Why Two Factor Authentication is Important
Let us tell you that two factor authentication can be done using biometric with knowledge factor. Drawing attention of the members to the market regulator SEBI’s circular dated December 3, 2018 on Cyber Security and Cyber Resilience Framework for Stockbrokers.
According to this circular, all demat account holders have been compulsorily asked for two factor authentication. Mainly said for internet based trading and transactions done through wireless technology.
What is Two Factor Authentication
According to a joint consultation with SEBI and the exchange, it was clarified that in addition to user ID, users can use biometric authentication as one factor authentication and can use these factors for second factor authentication.
Knowledge Factor (Password, PIN)
Possession Factor (OTP, Security Token, Authenticator App)
Do this work if you do not have biometric
It has also been told in the notification that if biometric is not being done at any place, then users can use both knowledge factor and possession factor. It has been said in the circular that it is necessary to do this two-factor authentication on every login session by the client through internet based trading and wireless technology.
How to enable Two Factor Authentication
For Two Factor Authentication, the account holder has to first generate TOTP (Time Based One Time Password). This is a different type of OTP, which is generated through the TOTP app. This TOTP is valid only for 30 seconds and is regenerated every 30 seconds.