Here’s how you can reclaim lost and unclaimed investor money

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Do you religiously maintain a record of all your current and past investments, bank accounts, etc? Many of us don’t. As a result, unclaimed wealth has piled up in various Indian banks and financial institutions. According to statistcs, about Rs 1,50,000 crore is lying as unclaimed deposits with various Indian banks and insurance companies as of December 2020. This is a significant jump from the previous figures of Rs 1,30,000 crore in 2018.

Any deposit is considered ‘unclaimed’ if the customer doesn’t bother to make any transaction from the account for a decade. Most of the unclaimed money remains with public banks and/or insurance providers. The report also said that State Bank of India has 15% of the total unclaimed deposits, the highest among all the banks. Similarly, Association of Mutual Funds in India (AMFI) stated the total unclaimed dividends and redemption amounts is Rs 1,100 crore.

Consequently, unclaimed deposits exist in abandoned bank accounts while unclaimed maturity proceedings of insurance policies remain with the insurance companies. Forgotten or lost investor money from mutual funds and stocks lie in dormant provident fund accounts.

How to retrieve investor money?

First check your primary email account or if you inherited a portfolio which was started pre-digitisation era, search for the paper documents. According to Avinnash Gorakshakar, research director at Profitmart Securities, MFs usually send across an account statement at the time of investments. It has important details about your investments like its folio number, your bank account number, residential address, units owned and other related details. In addition, half-yearly statements and emails are regularly sent to investors.

“If you don’t have these details, visit the websites of registrars (like www.camsonline.com) which offer free mail-back facilities. On keying-in your email or PAN number, it gives a consolidated statement of all your MF investments. Once you get the folio number, approach the fund house or its registrar and call up the customer care number or go to its nearest designated office. It will get you started on the claim process,” Gorakshakar said.

For dividend and redemption, cheques usually mention the name and bank account of the investor as it is in the records of the registrar. If you want to redeem, ensure you update your bank account details, residential address and the PAN number.

“In case of bank deposits, usually after a dormant period of 10 years, it becomes unclaimed and is shifted to Reserve Bank of India. Claim can be filed to retrieve these by submitting deposit slip, KYC details, Will or nomination and proof of kin,” Shweta Jain, CFP and founder at Investography pointed.

If the investor is no more?

If the investor is deceased, follow the necessary procedure by giving supporting documents such as death certificate and those relating to establishing the legal heir.

“Investors making a claim up to three years from the due date of redemption or dividend are eligible to receive initial unclaimed amount along with income earned on its deployment in liquid funds. After this, the income is used for the purpose of investor education by the fund house,” Gorakshakar explained.

Moreover, PAN has recently been made mandatory to redeem mutual fund units. So, one must not forget to update KYC details with PAN number.

Meanwhile, Jain stated that insurance companies get to know of a person’s death only after claim is filed, so one must ensure documentation including KYC, Will, nomination, policy documents, death certificate etc to claim the sum assured.

Engage with your finance actively

To avoid the situation where you have to retrieve lost and forgotten money, try to remain agile and active with your finances. One should regularly update their personal details such as residential address and bank account and email with the registrars. It will, then, automatically reflect in records of all mutual funds.

“If you are receiving frequent dividends on MFs, opt for the Electronic Clearing System (ECS) option. Thus, the dividend will directly be credited into the designated bank account, saving you the extra leg work. Adopting the online mode will make the transacting process convenient and fast,” Gorakshakar advised.

Additionally, you need to keep a proper record of investments, whether in paper form or electronic. Sharing it with a family member will make things easier in case of the sudden death of primary investor. When it comes to money matters, make sure to keep at least some kin in loop.