The dividends that remain uncollected or unclaimed by shareholders for a certain period of time are Unclaimed dividends. In India, dividends are typically considered unclaimed after a period of 7 years from the date that they were declared by the company.
Unclaimed dividends can result from a variety of factors, such as a change in address, a lack of communication between the company and the shareholder, or an administrative error. In some cases, shareholders may simply forget to claim their dividends or may not be aware that they are entitled to them.
Unclaimed dividends can have a significant impact on a shareholder’s portfolio, as they represent lost income and potential growth. In addition, unclaimed dividends can also reduce the overall value of a company’s stock, as unclaimed dividends are often used to buy back shares and reduce the number of outstanding shares.
It is important for shareholders to regularly check their accounts for unclaimed dividends and to take steps to claim them before they are considered unclaimed. This can help ensure that shareholders receive the full value of their investments and that they are able to maximize their returns over time.
In India, unclaimed dividends can be claimed through the Investor Services Centre of the Bombay Stock Exchange (BSE) or the National Securities Depository Limited (NSDL). Shareholders can also contact the company directly or seek assistance from a stockbroker to help them claim their unclaimed dividends.