The spike in unclaimed deposits and financial assets is a pressing issue that requires immediate attention
Mayank Mahapatra
Reserve Bank of India (RBI) on May 30, 2024, announced that unclaimed deposits with banks have surged by 26% than the previous fiscal, reaching a staggering ₹78,213 crore by the end of March 2024. This significant increase highlights a growing issue in India’s financial landscape with the rising amount of forgotten wealth.
The Scope of Unclaimed Wealth
According to the Investor Education and Protection Fund (IEPF), unclaimed financial assets include shares worth ₹47,226 crore and dividends totaling ₹5,715 crore. These figures underline the importance of awareness regarding unclaimed assets and the need for individuals to keep track of their investments.
When Do Accounts and Securities Become Unclaimed?
A bank account is classified as ‘unclaimed’ if it remains untouched for 10 consecutive years. After this period, the funds are transferred to the RBI. Similarly, securities become unclaimed if dividends are not accepted for 7 years. Reasons for non-crediting of dividends can include bank account closures, changes in IFSC codes, or dormant accounts.
A significant factor contributing to the rise in unclaimed assets is the unfortunate passing of individuals without informing their trusted ones about their financial holdings or failing to nominate beneficiaries.
Good News: Retrieval of Unclaimed Assets
The silver lining is that unclaimed assets can be reclaimed. The RBI has established a dedicated portal called UDGAM to assist individuals in locating and reclaiming their deposits.
For unclaimed shares, individuals must fill out the IEPF-5 form online through the Ministry of Corporate Affairs. After submitting the form, they need to send a printout along with necessary documents to the company’s nodal officer.
Steps to Prevent Unclaimed Shares
To avoid shares becoming unclaimed, individuals should:
- Keep demat records updated with active bank account details.
- Add a nominee to their demat account.
- Inform trusted individuals about the nomination and details of their assets.
This article serves as a crucial reminder for everyone about the importance of tracking financial assets. The rise in unclaimed deposits and financial assets is a pressing issue that requires immediate attention. By raising awareness and encouraging proactive measures, individuals can ensure that their hard-earned wealth does not go forgotten. With resources like UDGAM and clear procedures for reclaiming assets, there is hope for those seeking to recover what is rightfully theirs.
(The author is a communication professional. Views expressed are personal.)
