India’s markets regulator, SEBI, plans to introduce new nomination rules from September 2026, requiring all new single-holder accounts to designate up to three nominees, simplifying asset transfer processes and reducing unclaimed assets.
India’s markets regulator is set to change how investors handle nominations in mutual funds and demat accounts from September 1, 2026, in a move aimed at making account opening simpler and reducing the stock of unclaimed assets. According to the Securities and Exchange Board of India, the new framework will require nomination for all newly opened single-holder accounts and folios unless the investor formally opts out, while joint holdings will continue to treat nomination as optional.
Under the revised rules, an investor will be able to name up to three nominees and decide how the assets should be split between them. If the percentage allocation is not specified, the holdings will be divided equally. SEBI said that where a transfer leaves a residual odd lot or fractional balance, the remaining securities or units will go to the first nominee.
The regulator has also made the opt-out process explicit. Investors who do not want to nominate anyone will have to submit a signed declaration, rather than leaving the field blank. For joint accounts, however, any addition, change or cancellation of nominees will still need the consent of all holders. Reuters-style reports on the circular noted that SEBI first issued the revised nomination framework after receiving feedback from market participants on practical difficulties in the earlier system.
The update is meant to ease transmission of assets after an investor’s death, but nomination does not by itself make the nominee the legal owner. Succession rights can still depend on separate inheritance law. SEBI has urged investors to review and update nominee details after major life events such as marriage, divorce, the birth of a child or the death of a nominee.
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