Whether you are a mutual fund investor or a demat account holder, make nomination by 30th September.

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All individual demat account holders and mutual fund investors have time till September 30 to nominate their successor or opt out of the scheme by filling a declaration. If this is not done, the demat accounts and folios of the investors will be frozen, that is, they will be ‘frozen’ and they will not be able to withdraw their investments. According to the Securities and Exchange Board of India (SEBI), this order will be applicable to both new and existing investors. This step has been taken to help investors safeguard their assets and hand them over to their legal heirs.

Account and folio will be frozen

According to the new SEBI rules, new investors will have to name a nominee for their securities while opening trading and demat accounts or choose to opt out through a declaration form. If existing investors (including jointly held mutual fund folios) fail to meet this deadline, their folios will be frozen and they will not be able to withdraw their investments. Additionally, investors’ demat accounts or mutual fund folios will remain ‘frozen’ until they enroll or opt for an exit.

It is easier to transfer property

Market experts say that in the past many investor accounts have been opened without any nominee. In such a situation, there is difficulty in transferring the property to the rightful heir. In such a situation, this step is very good and it will remove the difficulties in transfer of property.

This will ensure smooth and seamless transfer of securities to the legal heirs of investors in case of any unfortunate event, said Tejas Khode, co-founder and CEO of ‘Fires’. Firoz Aziz, Deputy Chief Executive Officer (CEO) of Anand Rathi Wealth, said that this is an important and commendable step taken by SEBI.

The last date has been extended twice

In July, 2021, SEBI had asked all existing eligible trading and demat account holders to provide the option of nomination on or before March 31, 2022. Later it was extended by one more year till March 31, 2023. In respect of mutual fund unitholders, the regulator in its circular dated June 15, 2022, had made it mandatory for mutual fund customers to submit nomination statement or declaration for exiting nomination on or after August 1, 2022. It was extended till October 1, 2022 and then till March 2023. Following requests from market participants, it was decided to implement the provision of freezing folio and demat accounts from September 30, 2023 instead of March 31, 2023.

You can add nominee online like this

First of all you have to log in to your trading account.

After this, go to My Profile section and go to Nominee Details.

Select Add Nominee or Opt Out.

After this enter the information of the nominee like name, PAN number and address.

Then e-sign through Aadhaar OTP.

You can also follow the same process to change the nominee in your demat account.

You can add maximum three nominees

According to the current rules, a maximum of three nominees can be added to any demat account. If you are adding more than one nominee to your account, then their share will also have to be decided. You can change your nominee anytime. For this you will have to fill the nomination form again and update the demat account.

All these can be nominees

A nominee is a person who legally takes over the responsibilities of the account holder after his demise. The nominee can be any member of your family or even a friend. However, the name of HUF or any other institution cannot be given in the nominee of the demat account.

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