Low interest rates have shifted many retail assets from the safety of bank fixed deposits to market-linked investments like bonds and debentures.
Although we do not suggest such investments for most people, due to the taxation of interest at marginal rate, borrower’s risk of default and poor liquidity of such investments, some still invest in them for the ‘fixed’ high-interest rate offered.
One of our subscribers had invested in one of the recent debentures issuance by Muthoot Finance Ltd. The debenture was supposed to pay the coupon i.e. interest on a monthly basis. But the interest payments were not credited to the designated bank account on time.
In such a situation, you need to go to the registrar that handles the backend work of the issuance. You can find out the registrar to your bonds/debentures in any of the e-mail communications sent by the borrower, or you can search for it directly on the internet.
On the homepage, scroll down to Upcoming NCD and click on ‘more public NCD issuance’ to find the complete list. Be sure to match the company name and the correct issuance date, as some issuances might have different registrars.
Once you have found the NCD that matches yours, click on it and scroll down the page or find on page for ‘Registrar’. The name of the registrar and contact details will be available – you may call them and inquire.
Alternatively, you can also call the debenture issuing company’s helpline number and ask them for the registrar’s details.
The registrar should, in most cases, be able to solve your problems or at least guide you to the right person. But there are times when the registrar is inefficient, slow, rude, unresponsive or simply unaware.
In the case of our subscriber, the registrar Link Intime India Pvt Ltd was unresponsive to calls and e-mails, denied the issue of stuck payment despite produced evidence of bank statements, stalled the issue through vague replies, in short – were not useful at all.
In such situations, you can escalate the matter to Sebi, the market regulator, for grievance redressal and complaints. But before you take this step, you will need to establish that your problem is genuine and that the registrar is supposed to solve it.
Registrars are Sebi-registered intermediaries, and any complaints against them can be registered on Sebi’s SCORES platform. Go on the SCORES website (scores dot gov dot in), register yourself and lodge a complaint under the relevant heading. Sebi is bit slow at reverting to complaints. There is a chance that nothing might come out the complaint. This is what happened to our subscriber who waited for 30 days for Sebi’s response, but got nothing.
“I never heard from SEBI even after their deadline for response. The SCORES website also mentions the name of the person along with email ID at the target company that is responsible for responding to SEBI queries when such complaints are raised (though even this process is slightly convoluted and one has to read the FAQS to figure it out).”
“So, I emailed the concerned person as mentioned on SCORES, and received a reply the next day itself stating that they have confirmation with regards to the rejected payments, and shall initiate a new NEFT payment for the same.”
Therefore, the best advice here is to skip on the waiting for Sebi’s reply and directly contact the person mentioned in the FAQs.