Demat Account Nomination: A Crucial Step for Mutual Fund Investors

If you’re a mutual fund investor or a demat account holder in India, there’s an important task on your to-do list that you shouldn’t overlook. The deadline for nominating someone in your demat account is fast approaching – September 30, 2023. This requirement has been mandated by the Securities and Exchange Board of India (SEBI), making it essential for all demat account holders to either declare their nominations or opt out of the process by the specified date.

Failure to nominate a candidate can lead to the freezing of your mutual fund folio, a situation that you certainly want to avoid. To help you navigate this process smoothly, we’ve put together a comprehensive guide on how to nominate or opt out of nomination for your demat account.

Understanding Nomination

Before we delve into the nomination process, let’s clarify what nomination means in this context. Nomination allows you to appoint a trusted individual who will receive the securities held in your demat account in the unfortunate event of your passing. It’s a critical step in ensuring that your investments are safeguarded and passed on to your chosen nominee seamlessly.

Who Can Nominate and Who Can Be a Nominee?

Demat account holders who are individuals, including non-resident Indians (NRIs), have the privilege to nominate someone. Additionally, an NRI can also be nominated as a beneficiary. However, non-individual entities such as Trusts, corporate bodies, and partnership firms are not eligible to nominate, nor can they be nominated as beneficiaries. Power of attorney holders are also excluded from the nomination process. Minors are not permitted to nominate someone, but they can be nominated by others.

Can You Change Nominees?

Yes, you have the flexibility to change your nominated candidate at any time while you are the account holder.

How Many Nominees Can You Appoint?

You are allowed to appoint up to three nominees, giving you the freedom to distribute your assets among trusted individuals as you see fit.

Opt-In vs. Opt-Out Nomination

Opt-in nomination indicates your intention to nominate someone in your demat account, while opt-out nomination implies that you do not wish to nominate anyone. Although the choice is yours, it is strongly recommended to nominate individuals in your demat account to ensure the smooth transfer of assets in the future.

How to Nominate: A Step-By-Step Guide

You can complete the nomination process through both online and offline methods. Here, we’ll outline the steps for online nomination, which is a convenient option for many.

Step Description
1 Visit NSDL’s portal –
2 Click on the ‘Nominate Online’ option on the homepage
3 Enter your DP ID, client ID, PAN, and submit OTP
4 Select either ‘I wish to Nominate’ or ‘I do not wish to nominate’
5 If you choose ‘I wish to Nominate,’ a new page will open. Enter the Nominee’s Details
6 On the eSign Service Provider’s page, enable the checkbox and click on ‘Proceed’
7 Verify OTP

Upon successful submission of OTP, you will receive a confirmation. Once your DP confirms the nomination, it will be updated in your demat account, ensuring your assets are protected as per your wishes.

Don’t delay this important task. Nominate your trusted individuals today to secure the future of your investments.

Remember, the deadline for this crucial action is September 30, 2023. Take action now and protect your financial interests.

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