FAQs

What exactly is ECS?

ECS (Electronic Clearance Service) is a facility offered by Reserve Bank of India. It allows investors to receive dividends / interest payments by direct credit to their bank account. Investor gets credit in their bank account directly rather than getting a cheque through the post to deposit in their bank account. The investor gets a credit advice confirming the credit. The transaction appears in the passbook / account statement.

What if I have more than one bank account?

You can choose which bank account you want the dividend to be credited into. You are required to provide mandate for ECS to your DP.

Can I get dividend from different companies in different bank accounts?

The company receives data for dividend payment etc. from DP, hence you need to check with your DP.

What are the benefits of the ECS facility?

• ECS is fast and safe.
• The facility is available free of cost to the investor
• Since credits are made electronically on the due date, there are no postal delays
• Since the transfer is made from account to account, loss of warrants in transit and ensuing hassles for issue of duplicate cheques is avoided
• Since the transfer is made from account to account, fraudulent encashment of cheques is avoided

What if I stay in a city outside of your ECS list?

Since ECS is a facility administered by the Reserve Bank of India (RBI), you have to check with the bank branch where you have an account about the same. If your bank branch is not participating in the ECS, you can receive dividend and other payments by cheque sent to your postal address by post.

Why can’t MPSEZ take note of a change in my address?

As per Depository Regulations, MPSEZ has to take investor details (like name, address, number of shares held, ECs mandate details etc) from the depositories. Any change has to be made by the depository and MPSEZ cannot make any changes to addresses received from the depository.

For investors too this is a convenient process, since the changes need to be communicated only to one party – the Depository – rather than all the companies in which the investor holds shares.

Non receipt of Dividend Warrant / loss of warrant.  How do I get a duplicate dividend warrant?

You are required to communicate about  non-receipt of dividend, with all relevant details (DP ID and Client ID particulars, details of the period for which dividend not received).

• The first thing the R&TA will do is to check whether your dividend warrant has been returned as undelivered –for instance, was it because you were not at home, the address was wrongly written, etc.
• If this is not the case, the R&TA will see if the validity period of the warrant is over, since duplicate warrants cannot be issued during the validity of the original warrant.
• Once the R&TA has confirmed that the original warrant has expired, they will check the records to confirm that the dividend remains unpaid.
• Then they will ask you to execute an indemnity bond, in a prescribed format.
• Once they receive this, they will issue a duplicate warrant.

Note – a duplicate warrant will not be issued in respect of those shares for which a ‘Stop Transfer Indicator’ has been instituted, either by virtue of a complaint or by law, unless the procedure for releasing the same has been completed

Why do I have to wait for expiry of the validity period of the original warrant?

Dividend warrants are payable at par across the country, so banks do not accept ‘Stop Payment’ instructions for the same. This is the reason why you have to wait till the warrant is no longer valid in order to get a duplicate.

What is the validity period of the revalidated warrants?

Revalidated warrants are valid for 3 months from the date of revalidation.

Since MPSEZ shareholdings are dematerialized, what happens to Annual Reports?

Holding shares in dematerialized form does not affect the rights of shareholders. They are still entitled to receive Annual Reports, and can attend and vote at General Meetings.

What’s the difference between joint shareholders and a nominee?

• Joint shareholders have equal rights in the shares during their lifetime.
• If any of the joint shareholders dies, the surviving shareholder(s) become the holder(s) of the shares.
• A nominee gets rights in the shares only after the death of (all) the holder(s).
• As a rule joint shareholders are different from the nominee.
• Nomination is used mainly by sole shareholders, but if they so wish, joint shareholders can decide together on a nominee.