Letter of Confirmation
Also written LOC · Letter of Confirmation (LOC)
The letter an RTA issues instead of a physical certificate after processing a duplicate, transmission, split or similar request — valid for 120 days, within which the holder must demat the shares through a DP.
In plain language
SEBI wants physical share certificates to stop multiplying. So when a holder of physical shares asks the registrar for something that would traditionally produce a new certificate — a duplicate, a transmission after a death, a split, a consolidation — the registrar no longer prints one.
Instead it processes the request and issues a Letter of Confirmation. The letter confirms the holder's entitlement and carries the folio details. The holder then takes it to a depository participant, who raises a demat request, and the shares arrive in the demat account.
The letter has an expiry date. If the holder does nothing, the shares do not come back as paper; they move to the company's Suspense Escrow Demat Account until the holder claims them.
How it works
Which requests. Listed companies issue securities only in dematerialised form when processing eight service requests: (i) issue of duplicate certificate, (ii) claim from unclaimed suspense account, (iii) renewal or exchange of certificate, (iv) endorsement, (v) sub-division or splitting, (vi) consolidation of certificates or folios, (vii) transmission, (viii) transposition.
The timeline.
| Step | Rule |
|---|---|
| Issue of LOC | Within 30 days of receipt of the request, after removing objections |
| Physical certificate | Retained by the RTA and defaced with the stamp Letter of Confirmation Issued |
| Delivery | By registered or speed post, plus a digitally signed copy by e-mail |
| Contents | Details of folio and demat account number (if available) |
| Reminders | After 45 days and 90 days if no demat request has been received |
| Validity | 120 days from issue |
| Demat request | Holder submits the original or digitally signed LOC to the DP; the DP generates the demat request and forwards it to the RTA |
| Lock-in | Where securities must be locked in, the RTA intimates the depository of the lock-in and its period when confirming the demat |
| No request in 120 days | Securities credited to the issuer's Suspense Escrow Demat Account |
The LODR Regulations carry the same principle: under Regulation 39(2), credit of securities in demat form for sub-division, split, consolidation, renewal, exchange or duplicates is to be effected within 30 days of the investor's request.
A worked example
Dates are illustrative. A widow applies for transmission of 600 shares held in physical form in her late husband's sole name, where she is the registered nominee. The RTA processes it and issues the LOC on 10 February 2026.
LOC issued 10 Feb 2026
First reminder (45 days) 27 Mar 2026
Second reminder (90 days) 11 May 2026
Validity ends (120 days) 10 Jun 2026
The original certificate stays with the RTA, stamped Letter of Confirmation Issued. She receives the LOC by speed post and a digitally signed copy by e-mail.
Path A. On 2 April she opens a demat account and hands the digitally signed LOC to the DP. The DP raises the demat request; the RTA confirms; 600 shares are credited.
Path B. She does nothing, ignores both reminders, and 10 June passes. The RTA moves the 600 shares to the physical folio Suspense Escrow Demat Account and includes them in its monthly consolidated LOC to the company, which dematerialises them into that account. To get them now, she must submit Form ISR-4 and a client master list that matches the RTA's records.
Why NISM asks about it
Chapter 13 (Investor Interface with the R&T Agent) introduces the LOC and the eight demat-only requests; Annexure 13.3 (transmission SOP) gives the 45/90/120-day mechanics; Chapter 14.4 carries Regulation 39(2). Expect the 120-day validity, the 30-day issue timeline, and the list of requests that now produce an LOC instead of a certificate.
Common exam traps
- The procedure is changing, and the workbook flags it. It records a SEBI circular prescribing credit of securities for these service requests directly in demat mode with effect from 2 April 2026, and says only that an LOC issued before 2 April 2026 may still be submitted to a DP within 120 days of issue. The workbook does not describe the post-April 2026 steps. Learn the LOC mechanics as the workbook teaches them, and read any question for which date regime it is asking about.
- Valid for 120 days, with reminders at 45 and 90 days. Issue is within 30 days of the request.
- An LOC is not a share certificate. It cannot be traded; it has to be converted by a demat request through a DP.
- Expiry does not cancel the holding. The shares go to the Suspense Escrow Demat Account and can be claimed later.
- Transfer is not one of the eight requests — transfers of physical shares have required prior dematerialisation since 1 April 2019. Transmission and transposition are on the list.
- The physical certificate is retained and defaced by the RTA, not returned to the holder.
Check yourself
1.When an RTA processes a service request such as a duplicate certificate or a transmission, it issues a 'Letter of Confirmation' instead of a physical certificate. Within what time is it issued, and how long is it valid?
- a)Issued within 15 days; valid for 60 days
- b)Issued within 21 days; valid for 90 days
- c)Issued within 30 days of receipt of the request after removing objections, if any; valid for 120 days from its issue, within which the holder must ask a DP to dematerialise the securities
- d)Issued within 30 days; valid until the holder chooses to dematerialise
Show the answer
Answer: (c) Issued within 30 days of receipt of the request after removing objections, if any; valid for 120 days from its issue, within which the holder must ask a DP to dematerialise the securities
"The RTA / Issuer Companies shall verify and process the service requests and thereafter issue a 'Letter of confirmation' in lieu of physical securities certificate(s), to the securities holder/claimant within 30 days of its receipt of such request after removing objections, if any. The 'Letter of Confirmation' shall be valid for a period of 120 days from the date of its issuance, within which the securities holder/claimant shall make a request to the Depository Participant for dematerializing the said securities."
The two numbers to remember: 30 days to issue, 120 days of validity.
Options A and B use figures that do not apply to the LoC. (90 days is when the second reminder goes out — reminders are sent "after the end of 45 days and 90 days from the date of issuance".)
Option D is wrong — the validity is limited. If no demat request comes within 120 days, "the securities shall be credited to Suspense Escrow Demat Account of the Issuer Company."
2.Issue of duplicate certificates in place of lost ones has to be completed within ______ days of submission of duly completed documents.
- a)30 days
- b)15 days
- c)7 days
- d)60 days
Show the answer
Answer: (a) 30 days
The process has to be completed within a period of 30 days from receipt of duly completed documents.
Thirty days, and section 13.6 confirms it — processing of issue of duplicate security certificate request: 30.
A separate and much shorter deadline runs to the exchange: the Stock Exchange where the securities are listed shall also be informed of the loss of certificate and issue of duplicate certificates within 2 days of getting the information.
Two days there; thirty days here.
What must happen inside the thirty. The R&T Agent shall verify the documents and send them to the Issuer Company for approval. On receipt of the approval, the duplicate certificate shall be issued with the legend, "Duplicate certificate issued in lieu of certificate no._______" printed on it. The stamp duty, as applicable, has to be paid on it.
The words "duly completed documents" matter. The clock starts only when the file is complete — the holder having intimated the loss so that a 'Stop Transfer' shall be marked on the lost securities, filed a Police Complaint/ FIR/e-FIR, and furnished an indemnity bond and an Affidavit attested by a Notary Public or First Class Magistrate.
Option B's 15 days belongs to other services — demat, transposition, contact details, bank details, PAN and revalidation of instruments.
And since January 2022 the output is electronic. Issue of a duplicate is one of the eight requests where all listed companies shall issue the securities in dematerialized form only, the investor receiving a Letter of confirmation valid 120 days.
3.Once the Issuer Company approves a duplicate certificate, what legend does it carry, and within what time must the stock exchange be informed of the loss and the duplicate issue?
- a)'Surrendered for Dematerialisation'; within 15 days
- b)'Letter of Confirmation Issued'; within 7 days
- c)'Duplicate'; within 30 days
- d)'Duplicate certificate issued in lieu of certificate no.___'; within 2 days of getting the information
Show the answer
Answer: (d) 'Duplicate certificate issued in lieu of certificate no.___'; within 2 days of getting the information
"On receipt of the approval, the duplicate certificate shall be issued with the legend, 'Duplicate certificate issued in lieu of certificate no._______' printed on it. The stamp duty, as applicable, has to be paid on it. The process has to be completed within a period of 30 days from receipt of duly completed documents. The Stock Exchange where the securities are listed shall also be informed of the loss of certificate and issue of duplicate certificates within 2 days of getting the information."
Option A is the marking on certificates sent in for demat (Chapter 12).
Option B is the stamp used to deface a physical certificate once a Letter of Confirmation has been issued.
Option C gives the 30-day time to complete the duplicate process, not the time for informing the exchange.
Note that the R&T Agent does not issue the duplicate on its own — it "shall verify the documents and send them to the Issuer Company for approval."
Where this is taught
Free preparation for NISM Series II-ARelated terms
- DematerialisationConverting securities held as physical certificates into book-entry holdings: the certificates are defaced, mutilated and surrendered to the issuer, and an equivalent quantity is credited to the holder's demat account.
- NominationThe account holder's written direction naming who receives the securities on death — up to ten nominees for a demat account, with percentages that must total 100, mandatory for single holdings.
- Registrar and Transfer AgentThe SEBI-registered agency that keeps the investor records of a mutual fund — processing purchases and redemptions, updating folios and unit capital, and issuing account statements.
- Depository participantThe SEBI-registered agent through whom an investor reaches a depository — NSDL and CDSL cannot open investor accounts themselves, so every demat account is opened and operated through a DP.
- Stop transferA freeze an RTA marks on physical securities reported lost, or under a court restraining order, so they cannot change hands — lifted if no FIR arrives within 21 days of the notice of loss.
- Suspense Escrow Demat AccountA separate demat account a listed company opens to hold securities nobody has claimed — chiefly Letter of Confirmation cases not dematerialised within 120 days — purely on the rightful holders' behalf.
- Instrument of transferThe stamped deed (Form SH-4) signed by transferor and transferee to transfer physical securities — valid only if lodged within 60 days of execution; since April 2019 transfers need demat.
- Register of Destroyed CertificatesThe RTA's record of every physical share certificate it has shredded after dematerialisation — the workbook requires the entry but does not state how long the certificates must be kept before destruction.
- Form ISR-1SEBI's standard form for registering or updating PAN and KYC details on physically held securities — since 1 January 2022, no other RTA service request is processed until it is on file.
- Special re-lodgement windowA one-time SEBI window reopening the re-lodgement of pre-2019 physical transfer deeds returned for deficiency — six months from 7 July 2025, later extended a further year to 4 February 2027.