Vihar Vaishnav: The inaugural pilot of ‘Niveshak Shivir’ event was held recently in Pune, marks a pivotal step towards creating a more transparent and investor-friendly financial ecosystem in India.
The Challenge: Billions in Unclaimed Wealth
India’s rapidly expanding capital markets have, over time, accumulated a substantial volume of unclaimed investor assets. According to the Ministry of Corporate Affairs, over 1.1 billion unclaimed shares, valued at more than Rs 1 lakh crore, and approximately Rs 6,000 crore in unclaimed dividends are currently held with the IEPFA. These assets are typically transferred to the IEPFA when they remain unclaimed for seven consecutive years. Common reasons for this dormant wealth include changes in investor addresses, the unfortunate demise of shareholders, expired dividend warrants, changes in bank details, or unresolved ownership disputes. This significant pool of dormant capital highlights a systemic need for more accessible and simplified recovery mechanisms.
Pune Pilot: A One-Stop Solution for Investors
The Pune Niveshak Shivir was conceptualized as a “one-stop solution” to directly address these challenges. The event provided a comprehensive platform for investors to resolve a range of issues.
Key services offered at the Shivir included:
- Direct facilitation for the recovery of dividends and shares unclaimed for six to seven years.
- On-the-spot updating of Know Your Customer (KYC) and nomination details, crucial for future transactions and claims.
- Prompt resolution of pending IEPFA claim issues.
- Guidance on dematerializing physical shares, enhancing security and ease of management.
- Awareness sessions on common reasons for claim rejections and how to avoid them.
The pilot event saw enthusiastic participation from over 450 claimants and stakeholders from Pune and surrounding regions, underscoring a significant unmet need for such direct assistance. To facilitate this, between 19 and 31 dedicated service desks were set up, staffed by representatives from companies with unclaimed dividend accounts, Registrars and Transfer Agents (RTAs), and Market Infrastructure Institutions (MIIs) like the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), National Securities Depository Limited (NSDL), and Central Depository Services Limited (CDSL).
A specialized search facility was also available, allowing participants to quickly check for any unclaimed shares or dividends linked to them or their family members. Furthermore, the NSDL “Investor Guide to Claiming Unclaimed Shares and Dividends” brochure was launched, providing clear, step-by-step instructions and listing all required documents for the claim process. A core objective of the Shivir is to eliminate intermediaries by fostering direct interactions, thereby providing immediate grievance redressal and enhancing transparency.
The Power Duo: IEPFA and SEBI
The Niveshak Shivir is a testament to the synergistic efforts of two key regulatory bodies:
- IEPFA (Investor Education and Protection Fund Authority): Established by the Government of India, IEPFA’s mandate includes promoting investor awareness, ensuring effective grievance redressal, and facilitating the recovery of unclaimed investments. Beyond the Shivir, IEPFA is developing a new one-stop digital platform for real-time claim tracking and automated data validation. It has also signed an MoU with Kotak Mahindra Bank to disseminate investor education content through digital and physical networks. 20
- SEBI (Securities and Exchange Board of India): As the primary regulator of India’s securities market, SEBI’s fundamental role is to ensure transparency, prevent fraudulent practices, and protect investor interests. 22 SEBI achieves this through regulation making, market oversight, investor education campaigns, and grievance redressal mechanisms like the SEBI Complaints Redress System (SCORES).
The collaboration in Niveshak Shivir is particularly impactful in addressing issues like SEBI’s updated KYC guidelines. While these guidelines are crucial for market integrity, they can lead to “On-Hold” or “Registered” KYC statuses, restricting transactions. The Shivir’s provision for “on-the-spot KYC updates” directly helps investors validate their details, bridging the gap between regulatory compliance and investor accessibility.
Simplifying the Claim Process
The standard process for claiming funds from the IEPFA involves filing Form IEPF-5 online through the Ministry of Corporate Affairs (MCA) portal. Required documents typically include a PAN card, Aadhaar card, proof of entitlement, a cancelled cheque, and an original indemnity bond. After online submission, a Service Request Number (SRN) is generated, and physical documents are sent to the concerned company’s Nodal Officer for verification. 12 Once verified, IEPFA processes the refund electronically to the claimant’s Aadhaar-linked bank account.
These reforms, coupled with an upgraded online search facility, aim to make the path to recovering lost investments more accessible than ever.
Looking Ahead: A Nationwide Rollout
Building on the success of the Pune pilot, the Niveshak Shivir is set for a planned series of events across the nation. Future Shivirs will be organized in major cities identified as having high concentrations of unclaimed investor funds. A city-wise calendar of events will be developed based on the insights and learnings from the Pune pilot, ensuring an adaptive and effective expansion strategy.
These ongoing outreach programs, spearheaded by IEPFA and SEBI, underscore their unwavering commitment to fostering a secure, transparent, and truly investor-centric financial ecosystem in India. The long-term vision is to empower investors with the knowledge and tools necessary to confidently navigate the markets and ensure seamless access to their rightful entitlements, ultimately building greater trust and participation in India’s financial growth story.
