Old share certificates from companies your parents or grandparents invested in might still be lying around at home. While they may seem outdated, many of these shares have appreciated significantly over time. For instance, SBI shares purchased in 1994 for just ₹500 are now worth nearly ₹3.8 lakhs. With SEBI’s 2025 guidelines, private companies are now required to convert all physical shares into electronic form. However, what appears to be a simple transfer can quickly become complex due to SEBI’s compliance requirements, documentation formalities, and the dematerialisation process. This guide breaks down the entire procedure, showing you exactly how to transfer your shares safely and correctly.
Understanding the Different Types of Share Transfers
Not all share transfers follow the same path. The right process depends on how the ownership is changing hands.
Here are the major categories:
Voluntary Transfers:
When you sell or gift your shares to another person. These are straightforward but must happen digitally through a Demat account.
Transmission of Shares:
This happens when a shareholder passes away. The shares are “transmitted” to legal heirs or nominees. It’s a legal process, not a commercial one, and requires specific documents.
Inter-Family Transfers:
Transfers within family members, such as from parents to children. These can be done digitally, but still need proper forms and signatures.
Corporate Transfers:
When ownership changes due to mergers, acquisitions, or business restructuring.
IEPF-Triggered Transfers:
When shares remain inactive for years and get transferred to the Investor Education and Protection Fund (IEPF).
Understanding the correct transfer type helps you avoid rejection or delays in processing. Misidentifying the type is one of the most common mistakes investors make.
Why Physical Share Transfers Are No Longer Allowed
Until a few years ago, investors could sign the back of a share certificate, attach a transfer deed, and send it for name change. But those days are gone. Since April 2019, SEBI has completely stopped physical share transfers. All transfers now happen only in electronic form through a Demat account.
Here’s how the modern process works:
- Open a Demat account with a Depository Participant (like a bank or broker).
- Convert physical shares into electronic form by submitting your certificates and a Dematerialisation Request Form (DRF).
- Transfer shares digitally through your Depository Participant once they appear in your account.
This digital system makes transactions faster, safer, and traceable. It reduces the risk of fraud, forgery, and loss which are the problems that were common with paper certificates. If you still hold physical shares, converting them into Demat form is the first step before any transfer can take place.
Step-by-Step Process: Transferring Shares from One Demat to Another
Once your shares are in Demat form, transferring them to someone else whether through sale, gift, or family transfer is quite simple. This digital process ensures transparency and complete traceability, every movement of shares can be verified.
Here’s the step-by-step guide:
Step 1: Make Sure Both Parties Have Active Demat Accounts
Before you start, confirm that both the person transferring the shares (transferor) and the person receiving them (transferee) have active Demat accounts. Each account should have valid KYC details and be linked to a PAN.
Step 2: Complete the Delivery Instruction Slip (DIS)
DIS is a form that authorizes the share transfer. It includes important details like the ISIN of the shares, the number of shares being transferred, and the Demat account IDs of both parties. Both parties need to sign it correctly.
Step 3: Submit the DIS to Your Depository Participant (DP)
Hand over the completed DIS to your DP. The DP will check the information and process the transfer directly between Demat accounts, outside the stock exchange (off-market transfer).
Step 4: Receive Confirmation and Verify the Transfer
After the DP completes the process, both the transferor and transferee get confirmation via email or SMS. Check your Demat account to ensure the shares have been credited correctly.
When the Shareholder Has Passed Away: The Transmission Route
The transmission of shares is different from a normal transfer. It takes place when the original shareholder has passed away, and ownership needs to shift to their nominee or legal heir. Here’s how it works:
If a nominee exists:
The process is simple. The nominee provides a death certificate, KYC documents, and a transmission request to the company’s Registrar and Transfer Agent (RTA).
If there’s no nominee:
The process becomes longer. The legal heir must submit a Succession Certificate, Probate of Will, or Letter of Administration, along with identity and address proofs.
Once verified, the RTA transmits the shares into the heir’s Demat account. To avoid future complications, every shareholder should add a nominee to their Demat account and bank records. It takes only a few minutes and can save your family months of legal work later.
How to Find Out If Your Shares Have Been Moved to IEPF
If you can’t find your shares or haven’t received dividends for years, they might have been transferred to the Investor Education and Protection Fund (IEPF). This happens when dividends remain unclaimed for seven consecutive years. SEBI automatically transfers those shares and the related dividends to the IEPF to protect investor interests. Here’s how you can check:
- Visit the company’s Investor Relations page or the IEPF portal.
- Search using your name, folio number, or Demat details.
- Review any mention of shares or dividends marked as “transferred to IEPF.”
If you find your holdings there, you’ll need to file an IEPF claim using Form IEPF-5 and supporting documents like identity proof, address proof, and share details. This process can be technical, but professional guidance helps ensure you submit the right paperwork and follow up properly.
Common Errors That Delay Share Transfers
Even a small error can delay or derail your transfer request. A quick pre-verification can save weeks of delay. Here are some common mistakes to avoid:
- Name mismatch on documents (e.g., initials or spelling differences)
- Incomplete or unsigned transfer forms
- Wrong or missing ISIN codes
- Trying to transfer physical shares directly (not allowed anymore)
- Ignoring the IEPF status before filing for transfer
- Not updating PAN, KYC, or address before starting
NRI Share Transfers: Additional Rules You Must Know
Transferring shares as a Non-Resident Indian (NRI) involves a few extra steps compared to resident investors. This is because NRIs must comply not only with SEBI regulations but also with FEMA guidelines, ensuring all cross-border investments are properly documented and legal. Here’s what makes it different:
- Shares must be linked to NRE/NRO Demat accounts, depending on the investment type.
- All legal documents (like Power of Attorney, death certificates, or wills) must be notarised or apostilled abroad.
- Transfers involving inheritance may need approval under FEMA rules.
- KYC and bank details must match across all documents.
Many NRIs face delays when trying to reclaim or transmit old family shares in India, especially if those shares have already gone to the IEPF. In such cases, reaching out to a professional Unclaimed Investment Recovery Company can make the process smoother. They handle verification, liaise with registrars, and manage documentation across borders.
Expert Assistance That Simplifies Everything
Share transfers, transmission of shares, or recovering unclaimed investments can feel overwhelming. That’s where expert help makes a real difference. At Crystal Peak Wealth, we specialise in simplifying these complex procedures. Our team assists investors and families in:
- Setting up or updating Demat accounts
- Completing KYC and documentation for transmission and inheritance cases
- Handling IEPF claim recovery and follow-ups
- Preparing legal documents such as affidavits, indemnity bonds, and declarations
- Assisting NRIs with cross-border compliance and transmission of shares
As a trusted Unclaimed Investment Recovery Company, Crystal Peak Wealth takes the burden off your shoulders, ensuring every step is accurate, compliant, and stress-free. Whether you’re dealing with an old share certificate, an inherited investment, or an unclaimed holding, our professionals handle it with care and transparency.
Conclusion
Transferring or reclaiming old shares doesn’t have to be complicated. With the right understanding and the right guidance, it becomes a simple, well-documented process. Organising old investments now ensures that your family’s wealth stays protected and accessible in the future. If you’ve recently discovered old certificates or inherited shares, don’t wait. Begin the transmission of shares or the dematerialisation process today. And if you need help with documentation or recovery, reach out to Crystal Peak Wealth for expert support. Over 170 families have successfully converted their physical shares with us, and we are trusted by more than 2,400 clients across India.