Understanding the interface between trading account, demat account, and bank account is the key to your internet trading experience. Once you open the trading account and Demat account, you are required to transfer the fund from a bank account to the trading account. That is called funding the account. Whenever you buy the stocks, then the equal amount of cash will be debited from the trading account. In the same way, whenever you sell the stocks, then the equal amount of cash will be credited to your trading account. But to begin, you need to fund your trading account. That is where it all starts.
In the same way, whenever you buy the stocks, then such stocks will be credited into your Demat Account. In addition, whenever you sell the stocks, then such sold stocks will be debited to your Demat Account. To put it in perspective, Trading Account acts as a connection between Demat Account and Bank Account. Hence, to integrate all these i.e. Trading Account, Demat Account and Bank Account, Banks started to offer 3-in-1 Account. In such accounts, your banker will provide you with all the three benefits. This will be convenient for traders to have one point of contact for all the three accounts. If the broker does not have a banking license then they can only provide 2-in-1 account and not 3-in-1 accounts. However, do remember that, in some cases, banks may put pressure to manage the minimum balance in the savings account. When the bank offers you a 3-in-1 account they also get the benefit of float which is why they are able to pass you some of the bank related benefits to you as a customer.