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SEBI has streamlined the nomination process, allowing investors to opt out online or offline. Changes will be implemented from March 2024 to September 2025.
SEBI announces new rules for nomination.
SEBI New Rules: The Securities and Exchange Board of India (SEBI) has streamlined the nomination process in the Indian securities market through its new circular. The capital market regulator now allows investors with single-holding accounts to opt out of nomination either online or offline.
For demat accounts, Depository Participants (DPs), not the Depositories, will facilitate the online opt-out process for both existing and new investors.
Furthermore, nominees can now be changed an unlimited number of times.
SEBI will implement these changes in a phased manner, starting from 1 March and concluding by September 2025.
New Transmission of Assets Rules:
In the event of the death of a joint account holder, the assets will be transferred to the surviving joint holders without requiring fresh KYC. However, existing KYC must be updated to complete this process.
SEBI’s new rules enable surviving holders to update their address, mobile number, email, and bank details during the transmission process.
Investors can now authorise a nominee to operate their account if they are physically incapacitated but retain their legal decision-making capacity.
New Requirements for Demat and Mutual Fund (MF) Accounts:
The nomination form must specify the percentage of the account designated to each nominee. If the allocation results in an odd percentage, the remaining portion will be assigned to the first nominee.
“Any odd lot after division / fraction of %, shall be transferred to the first nominee
mentioned in the nomination form,” SEBI circular added.
