The main difference between the “Letter of Entitlement” and the “Letter of Confirmation” is that the Letter of Confirmation can be dematerialised.
The Letter of Confirmation is like an actual Share Certificate and is issued only for those shares that are not in IEPF.
Whereas, the Letter of Entitlement is issued for those shares that have been transferred to IEPF and it mentions the no. of shares that have been transferred to IEPF along with the list of the Dividend amounts that have been transferred to IEPF.
Letter of Entitlement cannot be dematerialised. This Letter is needed to start uploading the IEPF claim application of IEPF Portal.
Circumstances under which Letter of Confirmation is issued:
When original share certificates are lost and the shareholder applies for the issue of Duplicate Shares Certificate . Since the Companies do not issue Share Certificates now, they issue a Letter of Confirmation after processing the application for issue of duplicate shares.
When there is Transmission / Name Deletion due to the death of any one/all the holders of the shares in a folio. After processing the Transmission / Name Deletion, a Letter of Confirmation is issued by the Company.
It is important to note that Letter of Confirmation is only issued for the shares that have NOT been transferred to IEPF. In the above two cases mentioned above, if the shares are in IEPF then the Company will issue a Letter of Entitlement after processing the request for duplicate shares or after processing the Transmission / Name Deletion. Based on the Letter of Entitlement, the process to file a claim for shares & dividends from IEPF can start .
To summarize the key points:
Letter of Confirmation:
- Can be dematerialized and treated like an actual share certificate.
- Issued in cases where original share certificates are lost, and the shareholder applies for the issuance of duplicate shares.
- Issued in cases of transmission or name deletion due to the death of a shareholder.
- Only issued for shares that have not been transferred to IEPF.
Letter of Entitlement:
- Cannot be dematerialized.
- Issued for shares that have been transferred to IEPF.
- Specifies the number of shares transferred to IEPF and lists the unclaimed dividend amounts transferred to IEPF.
- Needed to start the IEPF claim application process.
It is crucial for individuals involved in share transactions to be aware of these distinctions to navigate the processes accurately.
What is “letter of entitlement”?
A “Letter of Entitlement” is an official document that confirms a person’s right to receive a particular benefit, service, or entitlement. This letter is often issued by a government agency, financial institution, or organization to acknowledge that the recipient is eligible for certain privileges, rights, or payments. For example, it might be used to prove eligibility for social security benefits, pensions, or health services. The letter typically outlines the specifics of what the individual is entitled to and may be used as proof when accessing these benefits.
What is “Letter of Confirmation”?
In the context of share marketing or securities, a “Letter of Confirmation” is a document sent by a broker or financial institution to confirm the details of a transaction involving shares or securities. This letter serves as official verification that a trade has been executed and typically includes the following information:
- Transaction Details: The type of transaction (buy or sell), the date, and the specific shares or securities involved.
- Price and Quantity: The price per share and the total number of shares bought or sold.
- Account Information: Details about the investor’s account, including the account number.
- Settlement Information: Information about how and when the transaction will be settled.
- Broker Information: Contact details for the broker or financial institution handling the transaction.
The Letter of Confirmation provides both the investor and the broker with a record of the transaction for their records and helps ensure that all parties agree on the terms of the trade.
