CDSL vs NSDL: A Tale of Two Giants in the Indian Stock Market

Do you remember when movie tickets were actual paper stubs you had to keep safe? Now, they're just a QR code on your phone. The Indian stock market has made the exact same journey. Gone are the days of paper share certificates; today, your investments are held digitally in a Demat account. But who is responsible for keeping these digital shares safe?

This is where two crucial players come in: Central Depository Services (India) Ltd (CDSL) and National Securities Depository Ltd (NSDL). Think of them as high-security digital vaults for your investments. While both are regulated by the Securities and Exchange Board of India (SEBI) and perform similar functions, they are two very different giants with distinct business models. This blog will break down everything you need to know about their differences. We will explore who they serve, how they make money, which one is more profitable, and what it all means for you as an investor, from the fees you pay to how you can be a part of their growth story.

What Exactly Do CDSL and NSDL Do?

Before we dive into the comparison, let's understand the role of these depositories. When you buy or sell shares, these institutions facilitate the transfer of ownership and keep a record of your holdings in a dematerialized, or electronic, form. This eliminates the risks associated with physical certificates, such as theft, loss, or damage.

• NSDL (National Securities Depository Ltd): Established in 1996, NSDL is the older of the two depositories and is promoted by the National Stock Exchange (NSE).
• CDSL (Central Depository Services (India) Ltd): CDSL was founded in 1999 and is promoted by the Bombay Stock Exchange (BSE).

CDSL is a publicly listed company, which allows you to buy and sell its shares. In contrast, NSDL is currently an unlisted company, though it has filed papers for an Initial Public Offering (IPO). Check more details about the NSDL IPO at INDmoney.

Also, explore what is the difference between CDSL and NSDL.

Market Share and Investor Base

The most significant difference between CDSL and NSDL lies in the investors they serve.

• CDSL: The Choice of the Masses
  CDSL is the favorite for everyday retail investors. With over 15.5 crore accounts, it has far more users than NSDL's 3.97 crore. This is because most popular stockbroking apps, which have made investing easy for millions, use CDSL. This has given CDSL a massive 80% share of all Demat accounts in India. You can know everything about demat accounts in India here.
• NSDL: The Powerhouse for Big Players
  While CDSL has more customers, NSDL is the top choice for the "big fish" of the market, like mutual funds, insurance companies, and large corporations. These big players trust NSDL with their huge investments. To put it in perspective, the average value of shares in an NSDL account is around ₹1.2 crore, while for a CDSL account, it's about ₹5 lakh.

Financial Performance: A Clash of Strategies

How these two giants serve different customers also affects how they make money.

• Revenue: The Advantage of High-Value Clients
  Think of NSDL as a luxury car showroom that sells a few very expensive cars. CDSL is like a popular car brand's showroom that sells thousands of affordable cars. The luxury showroom (NSDL) might make more money overall (revenue) because each car is so expensive. Similarly, NSDL earns more revenue (₹1,420 crore) than CDSL (₹1,082 crore) because its few, large clients make massive transactions.
• Profitability: The Efficiency of a Lean Operation
  Even though the luxury showroom makes more money, it might have very high costs. The popular brand showroom, however, might be better at managing its expenses. This means it gets to keep a larger slice of the money it makes as profit. This is exactly what happens with CDSL. Despite lower revenue, it is much better at managing its costs. It makes a profit of ₹526 crore with a high profit margin of 48.6%. This is more than double NSDL's profit margin of 24.2%.

How Do They Make Money? A Look at Their Revenue Streams

CDSL is a "pure-play" depository, meaning it sticks to services directly related to the stock market. NSDL, on the other hand, has branched out into other areas like banking.

Understanding DP Charges on INDmoney

So, how do these depositories affect your trading costs? This is where Depository Participant (DP) charges come in.

Think of a DP charge as a small fee for taking shares out of your Demat account when you sell them. Here’s how it works on INDmoney:

• Buying Shares: There are no DP charges when you buy shares. It's free.
• Selling Shares: When you sell, a flat fee of ₹18.50 + GST is charged.

The important thing to remember is that this fee is charged per company per day.

For example, if you sell 10 shares of Company A and 50 shares of Company B on the same day, you will be charged this fee twice—once for Company A and once for Company B. However, if you sell shares of Company A multiple times on the same day, you will only be charged this fee once.

This fee is a combination of charges from the depository (like CDSL) and your broker (INDmoney). For a more detailed breakdown, you can always check the 'Charges Explained' section on the INDmoney app.

Which Depository Is Right for You?

For most retail investors, the choice between CDSL and NSDL is not one you make directly. Your depository is determined by the stockbroker you choose. Most discount brokers popular with new investors use CDSL. Some full-service brokers might give you an option, but it's uncommon.

Switching depositories isn't easy either. You would have to close your Demat account and open a new one with a different broker, which can be a hassle.

So, the more practical question is: what do these differences mean for you as an investor?

• If You Want to Save on Costs: CDSL generally offers lower transaction charges than NSDL, helping investors save on costs. CDSL's business is designed to serve millions of customers and is also efficient at managing its expenses. This financial discipline is clearly visible in its high profit margin of 48.6%. Which means, for a sale of ₹100, CDSL saves ₹48.6 as profit while NSDL saves only ₹24.2 out of ₹100.
• If You Want to Invest in the System Itself: Since CDSL is a listed company, its shares are available to buy on the stock market. In the last 30 days (From May 6 to June 6), CDSL’s share has surged over 40%. NSDL, on the other hand, is preparing to launch its IPO and, in the unlisted market, sees a similar demand among investors, as per reports.
• Understanding Your Broker: Knowing your depository helps you understand the business you are connected to. CDSL makes its money purely from stock market activities. Its revenue is directly linked to how many people are trading and how many companies are listed. NSDL, on the other hand, has a more mixed business. A big part of its revenue comes from its banking services.

Final Verdict

The success of both these companies depends on one big thing: more Indians investing in the stock market. And that’s exactly what’s happening. The number of investors in India has skyrocketed from just 3 crore in 2020 to over 11 crore as of May 2025. This investor boom is the wave that both CDSL and NSDL are riding.

For most of these new retail investors, CDSL is often the more practical and cost-effective choice. Its widespread use by popular brokers, lower charges, and focus on the stock market make it a natural fit for millions. Its high profitability and status as a listed company also make it an interesting business to follow.

Disclaimer

Investments in the securities market are subject to market risks, read all the related documents carefully before investing. The securities are quoted as an example and not as a recommendation.This is nowhere to be considered as an advice, recommendation or solicitation of offer to buy or sell or subscribe for securities. INDStocks SIP / Mini Save is a SIP feature that enables Customer(s) to save a fixed amount on a daily basis to invest in Indian Stock. INDstocks Private Limited (formerly known as INDmoney Private Limited) 616, Level 6, Suncity Success Tower, Sector 65, Gurugram, 122005, SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500, Research Analyst Registration No. INH000018948 BSE RA Enlistment No. 6428. Refer https://indstocks.com/pricing?type=indian-stocks; https://www.indstocks.com/page/indian-stocks-sip-terms-and-condition for further details.