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TMI BlogRequest for digitization of records related to a major financial sectorIntroductionX X X X Extracts X X X X X X X X Extracts X X X X ..... Request for digitization of records related to a major financial sectorIntroduction - By: - G Binani - Corporate Laws / IBC / SEBI - Dated:- 30-8-2023 - In a world rapidly advancing towards digitization, India is no exception. The Government of India, led by Prime Minister Narendra Modi, has championed numerous reforms across sectors, focusing on modernization, transparency, and ease of access. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne noteworthy initiative in this journey is the swift digitization of government records. As this digital wave sweeps through various governmental functions, there remains a crucial area that requires immediate attention the digitization of the financial sector, particularly records related to companies. This article seeks to highlight the significance of digitization in the financial sector, es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecially for startups and shareholders, and makes a fervent appeal for much-needed reforms. 1. Enhanced Website Information: Bridging the Information Gap The Ministry of Corporate Affairs (MCA) and the Securities and Exchange Board of India (SEBI) websites are key sources of information for shareholders. However, the presentation of company data on these platforms needs improvement. A vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal step would be to display company names in a chronological order, starting from their initial listing or authorization to raise funds. This should be followed by a comprehensive mention of all subsequent changes, such as mergers, acquisitions, and name changes. This format ensures that investors can access the relevant information without undue difficulty, thus promoting transparency and inform ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed decision-making. 2. Simplifying Dematerialization for All Shareholders SEBI s introduction of the Basic Services Demat Account was intended to facilitate the demat process, particularly for those holding small-value shares or limited quantities. However, a major drawback exists a shareholder with a normal Demat Account in one depository cannot open a Basic Services Demat Account in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another. This limitation creates unnecessary hurdles and discourages shareholders from opting for dematerialization. Rectifying this rule by permitting the opening of a Basic Services Demat Account with a depository different from the one hosting the shareholder s regular Demat Account would undoubtedly promote broader participation in dematerialization. 3. PAN and KYC Update Simplification: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A Clear Path Forward SEBI s recent warning regarding freezing shares without linked PAN (Permanent Account Number) and KYC (Know Your Customer) details by March, 2023 but subsequently extended upto September 30, 2023, underscores the urgency of the situation. Unfortunately, the process for updating PAN and KYC remains unclear, leaving shareholders in a state of confusion. A potential solution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , until the aforementioned comprehensive company data becomes accessible, is to introduce a system of holding letters by SEBI itself, akin to those issued by mutual funds. These holding letters would represent shares in physical form and can be converted into demat holdings after the resolution of discrepancies. This streamlined process not only simplifies matters for shareholders but also enabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es authorities to collate crucial information efficiently. Conclusion: A Plea for Urgent Action In the light of these pressing issues, it is crucial for India s lawmakers and regulatory bodies to address the call for reform in the financial sector. Recognizing the potential impediments faced by ordinary, small, and senior shareholders, a swift response is essential. Digitization has the po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wer to democratize access to information, level the playing field, and foster a conducive environment for businesses and investors alike. As India marches toward a digitally empowered future, the financial sector must not be left behind. In the spirit of Prime Minister Modi s progressive methodologies, it is hoped that these matters will receive the attention they deserve. By implementing refor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms and bolstering the digitization of financial sector records, the Indian government can reinforce its commitment to transparency, inclusivity, and efficiency. In doing so, it will not only empower shareholders but also strengthen the foundation of the nation s financial landscape. - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanageme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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