Revolution of Mutual Fund Industry by RTAs

It is the technology which takes a normal growth rate of business to an accelerated progress dexterity. Whether it is a normal course of operation of an organisation or serving the clients with customer care facilities, technical advancement is necessary to make a win-win. In today’s digital era, if you are not upgraded with technologies and latest utilities, you can not ensure automation, ease and accuracy. 

Last few years evidence the enormous growth & success encountered by Mutual Fund houses. Here as well, the credit goes to high technology, the hi-tech facilities given by the Registrar & Share Transfer Agent (RTA).

It is only because Registrar and Transfer Agents (RTAs) that mutual fund houses could get to the top quickly and amazingly among other institutions of the financial sector such as banks, insurance companies, brokerage firms, etc. 

Read Also:- RTA - An “all-inclusive” Solution for Mutual Fund Investors

RTA agent is a cornerstone behind the astounding progress of mutual fund houses. By introducing & promoting advanced technology in the mutual fund houses, RTA Agent has assured accuracy and value addition in the services of mutual fund houses. 

Technology has transformed the financial sectors in a never-imagined way. Some of the examples include e-investment tools for investors and distributors, intermediary interfaces, data sharing apps, digital transaction systems; they all are techno-driven and bolstered.

Today, it's a matter of a few clicks and seconds to encash the money, to transfer the money, to get monthly payouts, to upload the investment statistics on different platforms. Similarly, executing a Systematic Investment Plan (SIP) with a mutual fund houses, asset management entity or insurance firm has brought high-level of convenience for investors, it would not have been possible without technological advancement.

Now let us shift our focus to Registrar and Transfer Agent and the way they have implemented technological up-gradation in the mutual fund industry to greet the ease, automation, speediness and many other exquisite services in the industry. We all know that RTA is linchpin behind the triumph & popularity of mutual fund houses. Let us march towards the answer to HOW?

A Registrar and Share Transfer Agent like SAG RTA being an intermediary serve the facilities to and interact with every stakeholder while maintaining the records of clients’ transactions on behalf of mutual fund houses. 

Different key stakeholders like asset management companies (AMCs), fund accountants, couriers & postal agencies, exchanges, depositories, depository participants, mutual fund utilities, channel partners, payment aggregators, and banks are served through sustained interfaces.

Management of Data

RTAs also processes & transfers all the investors’ & investment-associated details & data from diversified sources in multiple formats. RTAs regularly interact and help every stakeholder of the mutual fund industry in the management & maintenance of their data.

Import Data in all Formats and Exporting Them in the Relevant One

With the use of technology-based systems Registrar & Transfer Agent meets the diversified needs of different mutual fund investors easily and also exchange data with them in multiple formats which includes  CSV, DBF, Excel, text or advanced XML through web-services.

RTAs use technology-embedded system that creates the output files in accordance to the required data format and also input data in different formats from the stakeholders. Technology allows the RTAs to preserve the input and generate the output in the desired format. 

Read Also:- RTA is a Cornerstone of Mutual Fund Companies. See How?

It is because of the innovative approach of the Registrar & Transfer Agent industry that mutual fund houses could be ahead of the game and break new grounds. RTAs have been in the client’s best interest as well.

High Technology to Serve the Clients

Despite being highly successful & gangbusters, the whole Registrar & Share Transfer Agent industry endures to adopt cutting-edge technologies and implement ground-breaking ideas to serve the mutual fund industry and its clients in the best possible way. 

Adherence to Government Rules & Regulations

RTAs keep updating themselves as per the amendments in government rules & regulations and latest notifications. This up-to-minute leg-up alongside the adoption of lead-forward technology let RTAs like SAG Infotech provide world-class services to mutual fund houses and investors in adherence to legal norms. 

Safety, Security & Reliability

Beyond the shadow of a doubt, RTAs have been the true supporter for mutual fund stakeholders and the non-stop advancement in the RTA’s system & software guarantees reliability, security and confidentiality of big-league financial & investment-related facts & figures. 

Read Also:- RTA Expertise for Mutual Fund Houses and Investors

Reduction in no. of Complaints and Increment in Investments 

Unprecedented technologies of RTA have revolutionised the mutual fund arena in which number of complaints have reduced and the mutual fund investments have grown quickly in the past few years.

Taking the Stakeholder Ahead

Besides, leading off important services, processes and statutory changes in the mutual fund industry, RTAs are driving the industry stakeholders to become a top-drawer with technological advancements through ground-breaking innovation and out of the box ideas. 

Boosts Trust and Credibility within Investors & Regulators

Also, RTAs have upsurge the trust and assurance for mutual fund houses within investors, regulators and stakeholders. With the optimal use of hi-end technologies, RTAs are inviting front-line products, projects and procedures in the mutual fund industry. 

For mutual fund customers as well, RTAs have played no small role by catering the most efficient & valuable facilities to them. 

In the ever-changing dynamic market also, RTAs have potency and foresee to take mutual fund industry parallel or an advance of the banking sector.

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RTA - An End to End Solution For MF Investors & Companies

A mutual fund transaction involves a trail of activities that include digital and manual as well. Several transactions such as buying, selling and switching the shares are carried out by investors regularly and these transactions must be properly recorded & updated by the mutual fund companies to grease the wheels for future activities.

Sometimes circumstances to change investors’ address name or bank details also germinates and many investors need to dematerialise or rematerialise the share & securities, they also need to payout dividend etc.

So, in a scenario when they are busy executing their core responsibilities, who accomplish these tasks on their behalf?

Read Also:-  Why Registrar and Transfer Agent Boon For MF Houses & Investors?

Registrar and Transfer Agent Services of SAG Infotech takes on this responsibility. SAG RTA maintains & records the transactions carried out by the mutual fund investors on behalf of mutual fund companies and also facilitates investors doing their mutual fund related job.

It caters investors with services such as Transmission, Transposition, Name Removal, Investors’ Name & Address Change, Alteration in Client Signature, etc.

Apart from these basic RTA services, SAG RTA Registrar and Share Transfer Agent helps investors in settlement of all the IEPF claim, dematerialization of securities through CDSL/NSDL depositories, paying out dividends through ECS transfer, and so on also.

First, let us understand the meaning of Registrar and Transfer Agent Services and their role to dive into the benefits offered by them to mutual fund companies and mutual fund investors. 

Registrar and Transfer Agent

What is the meaning of Registrar & Share Transfer Agent?

Registrar and Transfer Agents refers to the trusts or third-party organisations which are appointed by mutual fund companies, financial institutions & publicly-traded companies to register and upkeep the detailed records of the transactions executed by their investors for their convenience. 

Such companies often have many investors who possess a part of the organisation and so their records need to recorded & preserved well and so they hire a third-party professional service by Registrar & Transfer Agents to carry out these tasks on behalf of these companies. However, some companies do not prefer such third party services and act as their own Registrar and Transfer Agent. 

What is the importance of Registrar & Transfer Agent for Mutual Funds Companies and Investors?

R&T agent is a single-window solution for Mutual Funds Companies as they execute all the investors’ and their transaction-related work like record keeping, updating the personal information of investors, etc on behalf of these companies and spare them with a lot of time to focus on their core job.

Since an R&T Agent is a specialised professional and works through its widely extended branches across the nation, it very-well meets the multiple needs of mutual fund companies as well as investors.

Read Also:- RTA is a Cornerstone of Mutual Fund Companies. See How?

RTA notifies the investors about new offers and schemes also and so act as marketing personnel for mutual fund companies while assisting investors to make a beneficial deal. R&T provides an end-to-end solution (E2ES) to all the three stakeholders of Mutual Fund Companies - Distributors, Investors and the Asset Management Companies (AMC).

Registrar & Transfer Agent is an all-inclusive solution for mutual fund investors as well and fully knock off the need for investors to visit the mutual fund offices. RTAs provide forms of fund houses to the investors, they also notify the investors about the dates of dividend distribution, new offers and maturity dates in case of fixed maturity plans (FMPs).

Besides, RTAs also complete the transactions of investors and procure their account statements.

Adding stars to the benefits, RTAs directly do not charge a fee from investors, mutual fund companies pay RTA which these companies recover from investors. 

Notably, SAG RTA Registrar & Transfer Agent Services must be availed from Securities and Exchange Board of India (SEBI) accredited RTA service provider like SAG Infotech that promises accuracy and adherence to prevailing laws.  

Leading RTA Agent in the Mutual Fund world of India are as follows:-

• SAG RTA by SAG Infotech Private Limited
• Franklin Templeton International Services Private Limited
• Computer Age Management Services (CAMS) Limited.
• Karvy Computershare Limited 

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Why Registrar and Transfer Agent Boon For MF Houses & Investors?

If you are one from the world of share investment and trading, you must have heard the word - Registrar And Transfer Agent more often. And there could be a possibility that you might have just heard about it but do not know its meaning and role.

This article is all about Registrar & Transfer Agents and their role. Let us start with its meaning.

Meaning of A Registrar & Transfer Agent

A Registrar & Transfer Agent, generally known as RTA refers to an intermediary or agent appointed by the mutual fund houses to execute the operations such as facilitating the transactions and maintenance of its records on behalf of mutual fund houses. 

The beneficial role of an RTA Agent is not limited to the mutual fund houses but it extends to assisting the clients as well. RTA takes care of financial as well as non-financial transactions for the mutual fund houses and at the same it caters the multiple needs such as handling the transactions, releasing the investors’ forms, issuing the account statements and so on, of the diversified clients situated at different locations of the country as well-known RTAs such as SAG RTA have their roots expanded all over the country through its branches.  Besides, Registrar & Share Transfer Agent notifies the investors about different beneficial offers and schemes, help them with securities dematerialization and dividend payment. 

In short, RTA is an important link between mutual fund houses and investors with enormous benefits, when chosen correctly. SAG Registrar And Transfer agent is the one such RTA which serves all ordinary services such as Transposition, Transmission, Name Deletion, Name Change, Client Signature and Address change in addition to the exceptional benefits such as IEPF claim settlement, Securities dematerialization via CDSL/NSDL depositories, dividend payout through ECS transfer; to the investors. 

SAG RTA is a SEBI certified & Rajasthan's first RTA Services provider and its innovative approach adds value to its services & guarantees accuracy, alacrity & on-time execution of responsibility on investors’ behalf.

Now, let us hone in on to the need for Registrar and Transfer Agents and benefits served by them.

Firstly, let's understand why mutual fund houses need RTA?

Need of RTA for Mutual Fund Houses

Mutual fund houses have a large number of investors who carry out numerous transactions regularly. Transactions such as switching, selling and purchasing shares or equities carried by investors need to be recorded by the mutual fund companies which also has to upkeep and update the personal details of investors from time to time or whenever required. 

Managing, maintaining and recording the personal details of the investor such as inventors' name, address, contact information along with the transactions executed by them is a big task in itself which demands time, energy and expertise. Mutual Fund Houses may or may have that much time and proficiency which is required but RTAs are experts and specialized in all these activities so mutual fund houses hire them or outsource their work to these trained agents who will take the entire responsibility on their shoulder.

Read Also:- Registrar and Share Transfer Agents To Facilitate Transactions in Mutual Funds 

Benefits of Registrar and Transfer Agent to the mutual fund houses and Investors

The first and fundamental benefit of hiring an RTA for the mutual fund house is the reduced cost and availability of time & energy for the mutual fund houses to focus on their core activities and hunt more opportunities to grow in the share market. 

Since RTAs take care of client’s transactions on behalf of mutual fund houses, the task is accomplished in a professional sense as RTAs are trained professionals and also mutual fund companies do not need to invest their time in the same. 

RTA acts as a promoter also. RTA has its presence throughout the country via its branches so it promotes the mutual fund houses at a faraway level & generating new clients while satisfying its current clients already present in different areas. In this way, it acts as a sales & popularity booster for the mutual fund houses. 

Benefits of Registrar and Transfer Agents to investors include the availability of different investment offers & schemes at a single window. RTA informs investors about various beneficial schemes and this knocks off the need for the investor to visit different fund houses to invest with them which also saves time & energy of the investor.

An R&T agent serves as a single-window solution to make an in-time investment in different fund houses. 

Ensure to choose an RTA which is SEBI approved and has excelled in providing innovative services. After-sale service is also a point to ponder while choosing an RTA service provider. SAG RTA Registrar and Share Transfer Agent have a squad of experts for all-day-long customer care support.

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All About Rajasthan’s 1st RTA Services Provider: SAG RTA

SAG Infotech proposed SAG RTA, is one of Rajasthan’s and SEBI category 1st leading Registrar & Transfer Agent Services, which is dedicatedly indulged to serve its potential clients.

RTAs are the SEBI authorized services which are devoted to cater to clients associated with Mutual Funds. In its clientele, Registrar and Transfer Agent include potential investors with a desire of making a sound investment in the market along with the mutual fund houses who proposed investment opportunities to the investors.

RTAs play a mediator role amidst parties like the investors and mutual fund houses to perform diverse activities such as a share issue, bonus issue, preferential allotment, keep a record of share buying/selling/switching or any other data related activity as well as a corporate related activity under the supervision and guidance of RTAs.

Eligibility to Become Registrar & Transfer Agent Services Providers

1. To become RTA service providers, the organizations required to get certified by SEBI to conduct RTA services across India. 
2. The organizations’ listing in two major depositories (NSDL and CDSL) is mandatory to become an authorized RTA service provider. 

SAG Infotech Private Limited - SAG RTAs Parent Company 

SAG RTA is a subsidiary arm of SAG Infotech Private Limited, which is a popular name among best tax software solutions providers in the country. The company is serving its clients which includes CA, CS and HR professionals for more than 2 decades with a wide variety of accounting and tax compliance software which are Genius, Gen GST, Gen IT, Gen Payroll, Gen XBRL and widely utilized in tax and management industries. 

But we didn’t stop here, after getting excellence in the tax industry, SAG Infotech took responsibility of performing a new role of RTA Agent and Their Services and become Rajasthan’s 1st SEBI certified RTA Agency. Also, the entity has registered its name in the top two depositories (CDSL and NSDL) concerned with security dematerialization and management.

SAG RTA - Rajasthan’s 1st RTA Services Provider

Working to provide effective RTA services across the country, the SAG RTA Registrar and Share Transfer Agent take care of the client’s convenience and satisfaction whether it is the investor or the mutual fund house. The department manages responsibilities such as maintaining investor’s transaction details, providing accurate data to the authorities, mailing, assisting mutual funds related issues and a lot more.

To perform the above-mentioned responsibilities, the company has a professionally trained staff (including tax experts, CA, CS, etc) which reach out to its clients and provide them with effective solutions for any issue related to mutual funds. There are a sufficient number of RTA specialists in the SAG RTA department who are eager to provide the best solutions to its potential customers, whenever required.

Being a newcomer in the RTA sector, the company is trying its level best to provide its best of its services to its valuable corporate clients and become the country’s leading RTA firm.

Services by SAG RTA (Registrar and Share Transfer Agent)

In terms of RTA services, SAG RTA can be considered as a one-stop solution for all the mutual fund related issues. It serves the listed corporates and mutual fund businesses with large and quality investor database and helps them with lucrative investment opportunities. SAG RTA is labelled as one of the most affordable yet premium service providers in the RTA Services in India. 

Services offered by SAG RTA are Listed Below:

RTA Services for Professionals (CA, CS, and others) and Companies: 

Roles and Responsibilities of SAG RTA (Registrar & Share Transfer Agent)

Devoted to convey top quality, transparent yet affordable Registrar Transfer Agency Services to its pan India clients, SAG RTA Registrar & Transfer Agent Services makes a bit of extra effort. All its valuable efforts to satisfy its clientele are indexed below: 

SAG RTA is receiving appreciation from the masses for its quality service available at feasible pricing. And it’s become professional’s (CA, CS or others) first choice due to reasons like:

Read Also:- RTA Agencies catering to all the demands of Investors as well as Mutual Fund Houses

It offers premium RTA Services: 

The company focuses on delivering premium and unhindered services to its clients. This makes the SAG RTA the most preferred RTA Services in Rajasthan as it provides services with full security and transparency. 

Avails Different RTA Forms: 

One can download several RTA forms from SAG RTA which are designed based on SEBI protocols. 

24/7 Connectivity with National Depositories: 

An issuer client can get benefited with the facility of 24/7 connectivity with two major depositories (NSDL and CDSL) just by clicking on the SAG RTA portal. The SAG RTA provides the issuer with the facility of all-time connectivity with NSDL and CDSL. 

Separate Dashboard Facility: SAG RTA facilitates professionals or the companies with the separate dashboard utility, those who require maintaining their ongoing Registrar & Transfer Agent related activities along with keeping track of their previous records.

Premium yet Affordable RTA services:

SAG RTA believes in conveying quality services at affordable pricing. This turns into a minimal profit margin for the company but greater customer satisfaction and convenience. We all are aware that a satisfied customer always turns back, which comes out as an excellent customer base for the company.

24/7 Expert Support - 

SAG RTA has a dedicated team of experts who are always ready to assist customers whether they are investors, professionals or companies through calls, messages or emails at any time. Also, they support a thorough verification of RTA documents submitted by the clients as well as safeguard the information provided by the clients. 

Updating Client Records - 

The customers furnish information regularly which needs to be updated in RTA records on the same day. Whether it is changing in name, address or signature or any other relevant information. Updating information regularly eliminates the chances of any mismatch or default. 

Media Publication and SAG RTA -

Since the SAG RTA gets certified by SEBI as the Rajasthan’s 1st RTA service provider. The company is under the lens of several renowned newspapers like Dainik Navjyoti, Punjab Kesari, Business Remedies, Daily News, Nafa Nuksaan, Rajasthan Patrika, etc., Also, these papers even provide a separate editorial column for the news exclusively from SAG RTA.

SAG RTA - An asset for CA and CS professionals

SAG RTA which offers premium RTA services at the most convenient rates, is a reliable source to avail RTA services in India. With the help of digitization, the company manages to provide a user-friendly, client-centric RTA platform for its customer base (distributors, mutual fund houses, investors, etc.) in the RTA industry.  

SAG RTA is an improved digital platform which serves its clientele as a single-window solution for all the RTA service. It enables the easy creation of ISIN and tracking of the download status of any RTA related form or document. 

Read Also:-  Check Why You Need To Have A Demat Account and RTA Service Provider?

In the given below table, you will find details of the required document for ISIN creation for shares at CDSL and NSDL: 

*Note:- All the aforesaid documents shall be signed & sealed by any or all the persons authorized in the board resolution by the company.

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Documents Required for Acquiring Duplicate Share Certificate

1. FIR from nearby police station - One must report the case of lost share certificate to the nearby police station and get the copy of FIR (citing the Folio No, Share Certificate(s), Unit Name, Distinctive No(s) and no. of lost shares) in original or attested by notary/gazette officer. FIR must be duly stamped by the concerned police station proving the legitimacy of the complaint. 
2. Indemnity Bond and Affidavit -  Indemnity and Affidavit bond on non-judicial stamp paper (purchased under his own name) of the value of requisite is required to be submitted by the shareholder. The affidavit needs attestation from the notary with a required notarial stamp, seal and registration number. 
3. Completely filed Questionnaire Form - Questionnaire Form related to information of the share is issued by the respective company/registrar which needs to be duly filled by the applicant shareholder. 
4. Surety Form - Surety Form is another most important document while acquiring the Duplicate Share Certificate which needs to be presented along with notary attested PAN card of the person who has signed as a surety. 
5. Documents Stating Applicant’s Income - Documents such as salary certificate/payslip or copy of the latest Assessment Order passed by Income Tax authorities or proposed Valuation Report by Revenue Authorities/Municipal Authorities /Secretary of Gram panchayat which is attested for authenticity by a Notary officer are required to be submitted along with the application of Duplicate Share Certificate. Income mentioned in the documents should be more than the current value of shares in the market.  
6. Information of Surety Giver - Personal information like Name, Address and Signature is needed of the person who has signed as a surety in the documents. Information should be visible in the Indemnity Bond and Surety Form.   
7. Address Proof of Applicant - Duly attested Address proof (electricity bills, water bills, passport etc.) and the copy of the latest bank statement/passbook is required by the applicant. To be noted; Changes (if any) in the documents need a signature from the applicant. 
8. Details of Lost Certificate - Details of lost shares such as Folio No., Certificate No. is mandatory in the Indemnity and Affidavit.  
9. Applicant’s Signature attested by a Banker - The applicant must get his specimen signature attested by the Bank official. Request letter for issuing the Duplicate Share Certificate or change in address must be duly signed by the applicant for authentication.  
10. Application to be sent via registered post - Application for lost certificate along with other required documents needs to be sent to the concerned Company/Registrar via registered post. While posting the documents ensure that you mention the valid mobile number or Email Id on the cover of the letter. 

Read Also:-  Transfer Of Shares Upon Death of Shareholder

Once the formalities are done on the applicant’s end and the documents are checked by the concerned authorities, the Company/Registrar will issue a Duplicate Share Certificate. The certificate will have credentials like a No. XXX and ‘DUPLICATE’ written in bold on its first page.   

SAG RTA Registrar and Share Transfer Agent is the department division of the renowned tax software company SAG Infotech and is Rajasthan’s 1st SEBI authorized RTA providing complete Registrar and Transfer Agent Services to its clients making mutual fund transactions and management a way easier task for them. Some of the major services extended by SAG RTA are dematerialization via NSDL/CSDL depository, investor regulatory reporting, dividend payout and much more.

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Role of Registrar and Transfer Agents in Rematerializing Securities

Depositories enable individuals to convert their physical share certificates into electronic account balances and vise-versa. Remat is that facility allotted to the investor through which he/she can easily convert his/her electronic security holdings with depositories into physical share certificates. To be noted: Securities requested for rematerialization cannot be traded. 

There could be various reasons Remat the securities like hinderance in trading because of trade-locked securities or simply when there is no desire to trade in shares or bonds.

By-Law 9.4: Rematerialisation And Business Rule 11.2: Rematerialisation of securities -are the legal provisions applied in this process.

Scrutinizing Rematerialization Process

Condition 1 -  You have decided to quit dealing in securities but you still have shares in your Demat account. Your Demat account charges you Rs. 500 to Rs. 1000 every year as annual maintenance fees, so to avoid paying maintenance charges in the name of account which you don't actually require, you can rematerialize your electronic securities in physical share certificates.

Condition 2 - Many investors have infrastructure bonds in their Demat accounts, such bonds are trade - locked securities and cannot be touched for at least five years. That means you cannot switch your demat securities from one participant to another before five years. You can choose to rematerialize your trade - locked bonds.  

The whole process of rematerialization takes not more than 30 days starting from the day of quoting a request.  

Rematirialization of securities is easy via the following steps:

1. Submit a request for Rematerializing your securities:

One needs to apply for rematerializing his/her electronic securities to the DP in which he already has a demat account. 

2. DP Verifying the Request:

DP upon receiving the request form from the applicant examines the form to check its accuracy. If the form filled is errorless, it issues the signed and stamped slip of acknowledgment to the applicant. While verifying the request form DP matches the signature of the applicant with the specimen signature in previous records. If the signatures are contrasting then DP does not approve the request.

Read Also:-  Know The Ways to Get a Duplicate Share Certificate

3. DP Transfering Request to NSDL:

DP enters request details in its DPM (software provided by NSDL to the DP), then transfers the request to the issuer of securities or R&T Agent. If the applicant has insufficient balance in his demat account, then the request will get rejected by DP. DP will inform about the same to the client.   

4. DPM issuing RRN:

If the applicant fulfills all the pre-set requirements and has sufficient balance in his account, the request will be extended to DPM, DPM in return will issue a Rematerialisation Request Number (RRN) which has to be filled in the rematerialization form. 

Read Also:-  Process To Remate The Security Holding Under RTA Services

5. Further Verifying The RRN Details:

The details in RRN has to be verified by a person other than the person entering the data. Once all the formalities are completed by DP the request reaches the DM, which further is extended to the Issuer or an R & T Agent via electronic modes.  

6. Rejection of Request by Issuer or Registrar & Transfer Agent:

Upon receiving the request from DM, Issuer or Registrar & Transfer Agents will process the request. They have the right of rejecting the request and report the objection to DP. they can send an objection memo to DP asking to clarify the objection. 

7. Acceptance of Request by Issuer or R&T Agent:

If the Issuer or R&T agent qualify your request for rematerialization will print and further despatch the certificates to the client. Simultaneously sends an electronic confirmation to the DM.

8. Status Update:

The DM downloads this information to the DPM and updates the status of rematerialization request in the DPM. The depository will update the account of the shareholder from which the rematerialized shares will be excluded.

9. Issuing Physical Share Certificates to the clients:

Once the request form is validated and approved by each party, the registrar will issue the physical share certificate to the client.

  

10. Fees Charged for the Remat Process:

As per the laws mentioned in Depositories Act, the depository cannot impose any stamp duty for transferring the shares when a remat request is made and only a nominal fee is charged for completing the process.

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Detailed Procedure for Grant or Renewal of RTA Certificate by SEBI

Registrar and Share Transfer Agent (RTA) is an organization that is designated to operate as an intermediary between investors and mutual fund houses. Registrar & Share Transfer Agent regulates all financial and non-financial processes like maintaining investor’s transaction records, processing those records for further reporting to the authorities, granting various application forms and assistance related to mutual fund investments. Mutual fund houses deal with investor’s daily transactions whereas RTA manages the records of such transactions on behalf of the mutual fund house associated with it.   

SAG RTA Registrar and Share Transfer Agent, CAMS, and Karvy are some of the prominent RTA service providers in India who serve investors as well as mutual fund houses with utmost care and responsibility. With their widespread branches, these RTA service providers can reach out to their clients present anywhere in the country. 

Investors can reach out to RTA for assistance related to security dematerialization by major depositories (NSDL or CDSL), issuing share transfer certificate, updating name, address or signature, dividend payouts and lot more.

SAG RTA, Registrar and Transfer Agent Services, is capable of solving investor’s issues and introducing them to various profitable mutual fund schemes and offers. 

 

All the RTA service providers operating in India are certified by the Security Exchange Board of India (SEBI). RTAs operating in India adhere to the guidelines listed in the Security Exchange Board of India (SEBI) Regulations 1993. 

Requisites for Qualifying as an RTA Service Provider from SEBI

Initially, the applicants must fill Form A along with the fees of Rs. 6 Lakhs  (non-refundable) for category 1, for category 2 the fees is Rs. 2 Lakhs (non-refundable). 

 

After filing the form, the board asks for additional information (not mentioned in Form A) as per the preset criteria. Even the applicant himself needs to appear in the board office before the board giving approval for performing RTA Services to the applicant.  

 

In case of any default, the board is authorized to reject the application. It will provide the statement mentioning all the errors and will give another chance to the applicant for fulfilling all the requirements within a given time limit.

Detailed Registrar and Transfer Agent Registration Procedure with SEBI

1 Applying for Certificate of Registration via Form A

The very first step towards becoming a SEBI registered RTA service provider is filing an application with the help of Form A to SEBI.   

2. Categories under which one can apply to become Registrar and Share Transfer Agent 

RTA services are divided into two categories either of which can be chosen by the applicant: 

• Category I: Carrying out services as both Registrar to an issue and share transfer agent.
• Category II: Carrying out services either as a registrar to an issue or as a share transfer agent. 

3. The applicant needs to provide further information to SEBI

The Board may ask the applicant to provide additional information necessary which is not mentioned in Form A and is required for issuing the certificate for Registrar and Transfer Agent registration. The board may ask the applicant or concerned principal officer to walk up to the board office for personal representation before the Board.   

4. Re-apply if the board rejects your application

As per the sub-regulation (2) of regulation 3 of the SEBI Act 1992, the board has the authority to disapprove Form A based on some errors in the information or non-adherence to the instructions. The Board will give a second chance to furnish form A within a given time limit. One must make sure that all the conditions mentioned in Form A should be fulfilled.

5. Scrutiny of the Candidate’s Application

Before granting the approval to work as a certified RTA, SEBI will thoroughly inspect all the aspects and make sure that everything favors a successful approval.

SEBI will make sure of the following points before granting approval:

1. The applicant must have sufficient infrastructure, the latest equipment/techniques and an expert team to effectively handle RTA processes.  
2. The applicant must have knowledge related to RTA services. 
3. The applicant must not be related (directly/indirectly) to a person who has been earlier rejected by the SEBI board to operate as an RTA. 
4. The applicant must have adequate capital to perform as RTA, mentioned in regulation 7 under SEBI regulations
5. Is under the radar of any disciplinary proceedings as per the SEBI Act for any of the director/applicant partner/principal officer has been found guilty for an economic offense, involving moral turpitude. 
6. Is a fit or proper person (mentioned in schedule II of securities and exchange board of India (intermediaries) Regulation, 2008.

6. Capital Adequacy as suggested by SEBI

The capital sufficiency requirement for an applicant to get certified as an RTA as per SEBI guidelines: 

• Category 1: the net worth for an applicant should be min Rs. 50 lakh and can go beyond.
• Category 2: the net worth of the applicant must be min Rs. 25 lakh.

6.2 The term ‘net worth’ given here has been defined under the sub-regulation (3) of SEBI, which denote:

In case, if the applicant is a firm or association of persons or any body of individuals, the total value of capital contributed to such business by the applicants, and free reserves of any kind to their business are accounted as net worth.

In the case of a corporate body, total net worth is the actual value of paid capital and free reserves that are registered in the application account books at the time of submission of application for grant of certificate to operate as an Registrar & Transfer Agent, according to the sub-regulation (1) of regulation 3 of SEBI.

7. Process for further registration

SEBI, after working upon the eligibility criteria and finding candidates eligible for performing as an Registrar & Transfer Agent Services provider, is obliged to extend a notice informing the candidates about their eligibility and category under which they can serve as a certified Registrar Transfer Agent. It is indeed the responsibility of the board to inform the candidate about the eligibility criteria for grant of certificate in Form B, which also depends upon the fee payment given under regulation 12 of SEBI.

8. Criteria for RTA Certificate Renewal 

The registrar to an issue or share transfer agent must apply for the renewal of the RTA certificate three months before its expiry period. The RTA service provider can do so with the help of Form A.

8.1 The renewal application must be processed in a way similar to applying for a fresh RTA certificate stated under regulation 3 by the Board.  

8.2 Criteria for Certificate Renewal

The below-mentioned conditions get applied in case of renewal granted under the registration 9 or any registration granted in accordance with regulation 8:

• In case an applicant applies for status or constitution change, prior Board permission is required to operate with the same power post-change.
• A certain amount is paid by the applicant for the renewal of the RTA certificate. The amount is determined by the SEBI. 
• Capital adequacy will be re-examined by the authorities. The applicant must fulfill all the requirements under regulation 7 of SEBI from the grant of the certificate until its expiry.
• SEBI approved RTA service providers must not take more than a month to resolve all the grievances from investors, to continue working as an RTA and subsequently inform all its stakeholder members about details like total complaints, etc.
• The candidate must comply with all the SEBI regulations while carrying out its activities as a registrar to an issue or share transfer agent before applying for a renewal. 

9. The procedure, in case, application for grant of certificate gets Rejected

9.1. In case the application for granting or renewing the RTA certificate fails to abide by SEBI guidelines then the Board has the right to disqualify the application but has to give the opportunity to re-apply fulfilling all the preset requirements by SEBI.

9.2 The Board informs the applicant about the rejection of his RTA certificate within three days from the date of applying for certificate along with the valid reason for the refusal.

9.3 Applicant can re-apply to the Board within thirty days from the date of getting a rejection notice from the Board post consideration, as per sub-regulation (2) of SEBI guidelines.

9.4 On receiving the application for reconsideration by an applicant, the Board will re-scrutinize the application and report the conclusions in a written format to the applicant. 

10. RTA Certificate (Grant or Renew) Refusal Consequences

Candidates whose application for granting or renewing the RTA certificate gets rejected by the Board, from the date of receiving the rejection notice are not eligible to perform any RTA related activities. Valid under regulation 2 of regulation 10 of SEBI.     

11. Payment Fees for a Grant or Renewal of RTA Certificate

11.1 The candidates, applying for a grant or renewal of RTA certificate in order to operate as a certified RTA agent should submit a certain amount as the processing fee to the Board within the specified time period and in a manner as given under Schedule II of SEBI regulations.

If the candidate fails to pay the renewal fees, the Board has the right to cancel or suspend his certificate, as a result, the registrar and share transfer agent will not be able to further extend its services to its clients as an RTA service provider or provide any RTA forms to the clients.   

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What are the Documents Required for Change of Registrar and Transfer Agent (RTA)?

A long list of certificates needs to furnished by companies or mutual fund houses to Central Depository Services Private Limited (CDSL) for their request against the change of Registrar and Share Transfer Agent.

Once such documents are received by CDSL, it verifies and authenticates the same to proceed with the change request. After completion of the verification process, execution agreement is passed on to the issuer company/RTA by CDSL.

Although, the entire process of Registrar & Share Transfer Agent change takes a long time for companies and also require them to submit multiple certified and accurate documents, which they are mostly unaware.

So. this article will provide an in-depth idea about the Registrar and Transfer Agent change procedure along with the mandatory documents that need to be furnished by companies to CDSL.

Below is a list of Key Documents whose Certified Copies Should be Submitted to CDSL by any Issuer/Company for Change of Registrar and Share Transfer Agent:

• Tripartite Agreement 

This document is signed by all the key parties, i.e., issuer/company, issuer’s RTA, and CDSL involved in the process to change of Registrar and Transfer Agent (RTA). This legal document also highlights the key roles, responsibilities, and obligations of all three parties. For the change of RTA, a fresh tri-partite agreement duly written on an INR 600/- stamp paper is required from any issuer company. This stamp-based tri-partite document should also carry authorized signatures of RTA and issuer/company.

• No Objection Certificate (NOC)

A NOC is a legal certificate that is issued by any company/entity indicating that it does not have any objection against the points or details mentioned in the NOC document signed by it. The companies looking for the change of RTA must furnish a no-objection certificate (NOC), issued by their current RTA, to CDSL. This NOC document should be written on the letterhead of the current Registrar & Transfer Agent of the issuer company.

• Document for Total Application Fee Charged By CDSL

Any particular company looking for a change of RTA should also submit the documents, reflecting the total fee charged by CDSL and any other outstanding issuer charges.

• Latest Certificates from Practising CA/CS

The company looking for the change in RTA should also provide the latest certificates from practicing company secretary/chartered accountant, which disclose details about the total issued capital to the issuer company, its annual balance with NSDL, CDSL and total physical share certificates according to the register of members. All such CA authorized certificates should be furnished by the companies to CDSL.

• Master Creation Form (MCF)

A Master Creation Form or Letter of Intent is used by companies to register as an issuer with CDSL. Registering as an issuer allow companies to offer Demat facility to its shareholders. The companies, through this form, also submit the securities to the CDSL in order to obtain an

International Securities Identification Number/s (ISIN/s) for the same.

During the change of RTA, master creation form also needs to be furnished to CDSL from the company end. This form should be duly signed and stamped by the authorized company signatories.

• Letter of Acceptance/Consent (LOA)

The companies should also submit Letter of Acceptance (LOA) to the CDSL while requesting for the change in RTA. Letter of Acceptance should be written on the letterhead of newly appointed RTA by the company. This LOA is a legal agreement reflecting that new RTA is ready to undertake all the share transfer responsibilities for the issuer company.

Note:- For in-house RTA, LOA is not required.

• Declaration Statement

Finally, the companies looking for the change in RTA should also furnish a declaration statement to CDSL, indicating that the company is ready to comply with all the necessary guidelines and procedures related to RTA change. The company will also be responsible for tackling all the grievances or complaints arising during RTA change process.

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