Unclaimed Money - Why its increasing in India? & How you can be at risk?
How would you feel if you suddenly found out that you have some hidden treasure in your house that you are unaware of? Won't you want to dig it out? Won't you think that - why didn't I know this before I faced all those hardships? Won't you believe…I am rich now!
Well, it is all about that hidden treasure today, about which you might not want to or let your children remain unaware of.
Unclaimed money is just that hidden treasure sitting in the financial institutions for years and years and then going to the government welfare funds. It is the money that any banks, finance or insurance-based institutions owe you, but you don't collect.
There are so many stories to tell and in how many ways? There has been more than whooping 1,50,000 crores of investor wealth lying unclaimed with the Indian Financial Institutes by March 2022.
A few years ago, there was an article in the newspaper about the importance of considering different ways of investing and increasing your money. One of them was the Stock market. When it opened in India in 1875, people started trading. The ancestors, the grandparents of many people, had purchased a particular company's stock when it was a new company in the stock market and now presently is a giant whale in today's economy. And since those transactions are from decades ago, the grandchildren have no idea that they might be millionaires today but cannot claim it as no record exists of their grandparent's transactions to prove their right.
In India, it also has been observed that family members do not share investment details or keep a proper record of their investments. Even the spouses, parents or children of respective investors are oblivious to the financial information. So, when untimely deaths occur, the investment amount stays unclaimed.
Another reason is that, even though family members know where money is, they are not profound enough to deal with the compliances and struggles associated with the claim process resulting in the capital getting added to the unclaimed pile. It is not just about investments but also instruments such as insurance, saving bank accounts, and provident fund money. And as much as everything around is progressing, this situation is getting worst. With technology advancing, companies create apps and websites to give customers easy access to investment options. And the customer is more eager to invest and get returns than to follow procedures. To prove, tell us how many of you read the lengthy "Terms and Conditions" form before accepting it? More than 60% of people don't. Hence, customers don't follow required procedures such as filling nominee, and succession details, which are mandatory for the claiming process.
The rate of increasing Unclaimed Wealth is terrifying. It stays frozen in the banks for years before it goes to the government, and for all those years, it is of no use to the economy. So, thousands of crores are there but are completely useless.
Hence it is our both need and responsibility to make sure that we educate ourselves and don't contribute to the increasing Unclaimed Wealth of the economy.