The Securities and Exchange Board of India (SEBI) has introduced a special window for eligible physical shareholdings to help investors convert old paper certificates into demat form. According to reports from Mint, the facility applies to shares bought or sold before April 1, 2019, and is restricted to bona fide and uncontested cases. The special window opened on February 5, 2026, and will remain open until February 4, 2027, specifically targeting legacy physical shareholding cases. As per Economic Laws Practice, SEBI's approach has become more "facilitative" as regulators have recognised the practical difficulties involved in resolving genuine legacy holdings, though the window is not intended to remain open indefinitely.
SEBI has separately approved norms for a simplified and standardised framework for securities transmission, aimed at making the process easier for legal heirs and nominees. The new framework provides faster processing of small-value claims, raises the threshold for simplified documentation, and reduces procedural requirements. In certain cases, it allows relaxation of probate requirements, which could help families claim shares more quickly after the death of the original holder. According to Economic Laws Practice, the framework includes safeguards such as compulsory dematerialisation, a one-year lock-in, indemnities and public notices to help genuine investors regularise their holdings while limiting the possibility of misuse.
Investors seeking to convert paper shares into demat holdings must submit mandatory documents including original security certificates, transfer deed executed prior to April 1, 2019, proof of purchase by transferee, KYC documents, latest client master list not older than 2 months, and an undertaking cum indemnity bond. The entire dematerialisation process takes 2 to 3 weeks to complete. Investors must contact their depositary participant (DP) and submit a dematerialisation request form, which will then be credited to their demat account. Demat accounts are essential for anyone wishing to trade in the Indian stock market, offered by depository agencies CDSL and NSDL. As per Economic Laws Practice, documentation becomes particularly important when the registered shareholder has died, as succession-related requirements may need to be completed before the shares can be transmitted.
Many investors and families across India still hold old physical share certificates issued decades ago, often discovered while sorting through inherited documents or forgotten investment files. The difficulty often begins when investors try to transfer these holdings after several years, with records needing to be matched with documents that are decades old. In some cases, the original shareholder may have died, leaving legal heirs to establish their claim. K C Jacob, Partner at Economic Laws Practice, noted that the process can involve scrutiny of "decades-old records" with issues including signature mismatches, missing transferors and incomplete registers. These cases can carry higher fraud risks compared with routine transfers, particularly when original holders are no longer alive and historical records become harder to verify.
