Dividend and Interest — Secretarial Practice STD 12 Commerce / Arts — Question

Dividend is either paid in cash or by cheque or warrant or by electronic mode. Dividend is paid to the shareholders. Following are the modes of payment of dividend:
(i) Dividend Warrant:
It is a cheque sent by a company to a shareholder for payment of dividend to the registered address of the shareholder.

(ii) Dividend Mandate:
A shareholder can also receive dividend directly in the bank account for which the shareholder has to send a request to the company in the prescribed form called ‘Dividend Mandate’. Dividend mandate authorizes the company to pay dividend directly to shareholder’s bank account.

(iii) Electronic Mode:
Company can also use electronic mode to pay dividends.
It is mandatory for the listed company to use electronic mode of payment approved by RBI such as ECS (Electronic Clearing Services), NEFT (National Electronic Fund Transfer).
Banks should also make necessary arrangements with other banks in collaboration for paying dividend through Dividend Warrants at par.