Receiving cheque/draft payment due to incorrect bank details

Hi!

This is a common issue many investors face. Here are some possible reasons why companies are sending cheques or drafts instead of direct credit to your demat account bank details, even though you provided the correct info:

1. Mismatch in Bank Details with Registrar Records:
   Sometimes, the company’s registrar or transfer agent hasn’t updated your correct bank details in their records even if you have submitted them. They rely on old records, so payment goes via cheque/draft.

2. Multiple Bank Details Submitted:
   If you have submitted bank details at multiple points (like with your broker, depository participant (DP), and company registrar), sometimes the company pays based on outdated details.

3. Incorrect or Incomplete Verification:
   Companies might require additional verification or confirmation before enabling direct credit. If this step is incomplete, they revert to cheque/draft payments.

4. Company/Registrar Policy:
   Some companies or registrars still prefer issuing physical payments by default, especially for debentures or bond interest, due to internal policies or regulatory requirements.

5. System or Technical Issues:
   There might be technical glitches or delays in electronic payment processing systems.

What can you do?

• Confirm your bank details with the company’s Registrar & Transfer Agent (RTA): Contact them directly and verify the bank details they have on record.

• Update KYC and bank details through your Depository Participant (DP): Ensure your demat account bank details are fully updated and linked correctly.

• Submit a bank details confirmation letter: Some RTAs require a physical letter or a form to update bank info.

• Follow up regularly: Keep track of your requests and confirm once updates are done.