The amounts involved are large. At the end of February there were nearly 35,000 crore rupees in unclaimed deposits in over 10.2 crore accounts. Though below the 48,000 crore rupees last year, the unclaimed amount at banks, led by SBI, has almost doubled from 18,000 crore rupees in 2019.
Likewise, at the end of March 2022, the Investor Education and Protection Fund (IEPF) was sitting on a pile of over 5,200 crore rupees and that pile is growing. According to the law, due deposits with companies, bonds, etc Redemption Amounts of the preferred shares flow into the fund. Likewise, all shares on which no dividend has been paid or claimed for at least seven consecutive years must be transferred by the companies to the IEPF.
The IEPF’s latest annual report estimated that over 105 crore of shares were available at the agency at the end of 2021/22, but the figure was not given. A paper published by the Association of Registered Investment Advisers estimated that 24,000 crore rupees lay unclaimed in mutual funds. Industry experts said it was difficult to gauge.
Regulators are now expected to urge banks, market participants and insurance companies to settle their dues on a war basis with the IEPF, under the oversight of the Ministry of Corporate Affairs (MCA), which is also likely to play an important role . Indeed, last month RBI Governor Shakkanta Das announced the launch of a unified portal so that depositors would not have to look up multiple sites.
While banks are expected not only to look after depositors or their heirs and to assist them in settling the funds they hold, the situation on the ground is different: branch managers are often reluctant to settle claims. Similarly, the IEPF has settled 26,044 claims and distributed 61 lakh shares and dividends of less than 11 crore rupees to the rightful claimants in 2021-22.