SDG 10: Reduced Inequalities | SDG 16: Peace, Justice and Strong Institutions | SDG 17: Partnerships for the Goals
Ministry of Corporate Affairs (MCA) | Investor Education and Protection Fund Authority (IEPFA)
The Ministry of Corporate Affairs (MCA) has invited public comments on proposed amendments to the IEPFA (Accounting, Audit, Transfer and Refund) Rules, 2016. The primary objective of these reforms is to simplify and accelerate the refund process for “low-value claims,” addressing long-standing procedural hurdles for small investors. By introducing a trust-based, company-led verification model, the Authority aims to reduce the disposal timeline to just 30 days for eligible claims.
Defining Low-Value Claims
The Authority has established specific thresholds to categorize claims eligible for the expedited process:
Dividend Claims: Amounts up to ₹10,000.
Physical Shares: Market value up to ₹5 lakh.
Dematerialised Shares: Market value up to ₹15 lakh. For these categories, the Authority proposes to rely solely on the verification report submitted by the concerned company, bypassing more intensive bureaucratic reviews to enable faster, hassle-free disbursements.
Enhanced Accountability and Transparency
Beyond speed, the amendments introduce structural improvements to protect investor interests:
Procedural Clarity: Rationalization of documentation requirements and clearer definition of responsibilities for companies.
Appeal Mechanism: For the first time, a formal appeal mechanism is proposed for claimants in cases where their application is rejected, ensuring greater accountability and transparency.
Disposal Timelines: Companies will be under a strictly monitored 30-day window to provide their verification reports, ensuring the Authority can meet the overall expedited refund goal.
What is the “Investor Education and Protection Fund Authority” (IEPFA)? The IEPFA is a statutory body established under Section 125 of the Companies Act, 2013, specifically to manage the Investor Education and Protection Fund. Its core responsibilities include promoting investor awareness and protecting the interests of investors by facilitating the refund of unclaimed dividends, shares, matured deposits, and debentures that have been transferred to the Fund after remaining unclaimed for seven consecutive years.
Policy Relevance
The proposed 2026 amendments represent a significant shift toward citizen-centric digital governance.
Ease of Living: By prioritizing low-value claims, the policy directly benefits retail investors and senior citizens who often find the existing refund process disproportionately complex for small amounts.
Corporate Responsibility: The move places a higher degree of trust and responsibility on companies to verify their own shareholders, shifting the Authority’s role toward oversight rather than primary processing.
Reducing Administrative Burden: Streamlining the high volume of low-value claims allows the IEPFA to focus its specialized resources on more complex, high-value cases and legal heir disputes.
Relevant Question for Policy Stakeholders: How can the IEPFA leverage the existing MCA-21 database and digital KYC protocols to automate the verification process for companies, potentially reducing the 30-day timeline even further?
Follow the full news here: Public Comments invited on Proposed Amendments in IEPFA (Accounting, Audit, Transfer and Refund) Rules, 2016