From UPSC perspective, the following things are important :
Prelims level : CDSL
Mains level : NA
Certain services at CDSL (Central Depositories Services India Ltd) were disrupted due to a suspected cyber-attack over the weekend.
What is CDSL?
- CDSL, or Central Depositories Services India Ltd, is a government-registered share depository, alongside its other state-owned counterpart National Securities Depository Ltd (NSDL).
- It was founded in 1999.
- It is a Market Infrastructure Institution or MII that is deemed as a crucial part of the capital market structure, providing services to all market participants, including exchanges, clearing corporations, depository participants, issuers and investors.
- Share depositories hold shares in an electronic or dematerialised form and are an enabler for securities transactions, playing a somewhat similar role to what banks play in handling cash and fixed deposits.
- While banks help customers keep their cash in electronic form, share depositories help consumers store shares in a dematerialised form.
Functions of CDSL
- CDSL facilitates holding and transacting in securities in the electronic form and facilitates settlement of trades done on stock exchanges.
- These securities include equities, debentures, bonds, Exchange traded Funds (ETFs), units of mutual funds, units of Alternate Investment Funds (AIFs), Certificates of deposit (CDs), commercial papers (CPs), Government Securities (G-Secs), etc.