Small investors of 50-60 years ago, who then had bought shares after paying all due taxes every year besides controlling their so many needs[ keeping in mind nation building ] ignoring other investment option such as Land / Gold / FD etc. on assurance of our political / Economic / Stock Exchange experts that this investment not only will provide decent returns but will help in nation building.

Now keeping future in mind we kept shares in joint names with one’s spouse, son, daughter (as the case may be), for safety purpose, is now a senior citizen facing problem even for opening Demat account in the names in which the shares stand.

We appreciate demat move and like to convert but facing so many problems before move towards demat such as —

1] Due to frequent transfer we have missed not only so many important information but failed to comply certain formalities related to our investment. Such as–

  A] Our physical scripts either lying in parental place OR some time at children’s placeOR not delivered to us.

  B] Due to change in name  OR   change in denomination  OR   other reason such as merger /demerger / consolidation etc. scripts with us not valid for demat

  C] Due to change in Co.’s  address  arising as explained in Clause 2 above we feel helpless

  D] There are changes in RTA too i.e. old RTA either left or replaced due to change in management

  E] There are companies who got converted from public to Private Ltd. due to ownership change

  F] Absence  of joint holder due to so many reasons

2] There are companies who after strict direction from SEBI started demat process

3] There are companies who are not on CDSL then our NSDL DP is unable to demat similarly if not on NSDL then not possible with CDSL DP.

Please remain informed that due to the above mentioned reasons, millions of investors who have invested in the stock market still have shares in the physical form. At present as per estimate shares worth Rs 5.30 lakh crore are in physical form.

We all know and understand whatever stated about demat is best option for us but question is to first sort out basic problems as stated above then move towards this compulsion otherwise hard  earned income which is in form of investment will become zero then honest small senior share investors will term this act as betrayal towards them.

Government / SEBI / Stock Exchanges can overcome all these type of problems if they put onus on company to get all shares compulsorily demated and credit effects only when investors submits written request i.e. investors should be given an opportunity to get holding style in same manner in which order demat a/c stands .  In fact from beginning this process could have followed.

Now understand multiple demat related problems and solution such as —

1] How to get shares demated unless SEBI modifies provision i.e. should allow dematerialisation of physical shares held in joint names to the Demat account in the first holder’s name.

2] First of all SEBI should develop a webpage which should contain all company’s name whether exist / vanished / liquidated  i.e. updated information since inception so that any investor writing any name on visiting that page should get updated details  i.e.   name which was at the time of registration  [ along with who was then registrar and who is presently ]

This web page should be developed in such a manner which do not force seniors to feel waste of time – what I mean simple as this will help investors to pursue the case effectively otherwise we are not in a position to keep track of old investments.

3]Due to age and passage of time signatures are bound to differ but certainly style, manner, flow and language will match. Hence there should be certain relaxation in these type of cases.

4] Due to unavailability of physical shares SEBI should make mandatory for co. to accept affidavit on 10/- stamp paper and rest exercises should be on plain paper besides FIR either should be waived OR self attested copy of letter posted to police station ( under registered cover ) alongwith receipt of Post office and advt. if necessary then it’s exp. should be borne by co.

Now why I insist for above please note seniors have no so much energy to comply all  – as every step requires frequent visit besides expenses [ please note those who have retired from pvt. firms do not have pension hence they have little source of income ]. Secondly 10/- stamp paper carries same weight as 500/- stamp paper.

We hope that SEBI will implement above action plan with immediate effect, considering the above facts, which will completely withdraw physical stock from the market [ as co. has to provide only credit effect destroying physical so surrendered ].

All SEBI officials should understand that in absence of above proper information small senior stock investors are helpless despite their demat desire. We are sure if above suggested modifications carried then dramatically physical shares will start vanishing speedily and SEBI  will achieve the  goal

In the wake of the above, if we try together, we can hope for a miraculous success.

GD Binani, Bikaner, gd_binani@yahoo.com, 7976870397 / 9829129011

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One Comment

  1. S. Agarwal says:

    Transfer of shares in physical form should be allowed for Senior Citizens who have no demat account, neither they can open demat account due to so many KYC documents required to open demat account…

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