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WHAT IS UNCLAIMED INVESTMENT?

Unclaimed investments are the investments that are lying idle in a wide spectrum of financial instruments such as shares, mutual funds, bank accounts, insurances, provident funds and post office deposits. No confirmed official estimate yet, but it is widely believed the overall amount of unclaimed investments could run into hundreds of crores. The treasure trove is just waiting to be claimed by rightful owners.

Unclaimed investments are usually found in lapsed insurance policies, unredeemed mutual funds, dormant bank, public provident fund and postal accounts and unclaimed dividends. In the insurance sector, both life and general insurance companies, are grappling with unclaimed investments which were not encashed by policy holders or their nominees. Many Provident Funds account holders neither withdraw nor transfer their PF accounts with a change of job, leading to piling up of unclaimed investments. In the post office, such investments are stuck in various schemes of Indira Vikas Patra, National Savings Schemes besides the regular savings pools. Banks-both private and public—are flooded with dormant accounts.

The country’s capital markets are no exception. The problem of unclaimed investments has been well-entrenched in wide range of areas of stock, mutual funds, unclaimed dividends and conversion of bonds. As reflected in a ‘Business Standard’ report which quoted authentic data to suggest that 21 billion shares in about 4,000 companies, amounting to Rs 2.3 lakh crore, are currently held in physical form. This essentially means thousands of investors may have simply forgotten the stocks or mutual funds they had bought long ago or do not know about the shares/mutual funds they have inherited. As many lose tracks, investors would also not have any inkling of the corporate benefits (dividends, bonus, split shares etc) paid on these investments. Who knows for many goldmines are just waiting to be discovered !

THE TREASURE TROVE

STOCKS

Mutual Funds: ??

Dividends/Deposits/debentures : Rs 3454.3 crore

Provident Funds: Rs 16,000 crore

Insurance: Rs 6750 crore

Banks : Rs 3652 crore

Post Office: Rs 1006 crore



MINISTERS

SPEAK

NIRMALA SITHARAMAN

Minister of Commerce and Industry to Lok Sabha
"Based on the data uploaded by companies (on the Ministry's website), Rs 3,454.29 crore representing such amounts was with companies as on March 31, 2014. These amounts would be transferred to Investor Education and Protection Fund (IEPF) after expiry of seven years, if these remain unpaid and unclaimed on expiry of that period.”

ARUN JAITLEY

Finance Minister in his budget speech.
“A large amount of money is lying unclaimed with PPF and post office saving schemes. These are mostly out of investments belonging to senior citizens which, on their demise, remain unclaimed for want of relevant payment instructions.”

RAVI SHANKAR PRASAD

Minister of Communications and IT to Lok Sabha
"Main reason for unclaimed amount is non-withdrawal of money by depositors after maturity of their investment in small savings schemes discontinued long back,"