From September 1, 2026, Indian investors must explicitly choose or opt out of nominations for single-holder demat accounts and mutual fund folios, aiming to simplify succession processes and reduce disputes.
From September 1, 2026, investors opening single-holder demat accounts or mutual fund folios in India will have to make an explicit choice on nomination rather than leaving the field blank, according to TV9 Hindi and the Securities and Exchange Board of India’s May 29 circular. They will either name nominees or submit a signed declaration opting out of nomination altogether.
The change is intended to make succession easier and reduce disputes or delays after an investor’s death. According to the reporting, the new framework applies only to single-holder accounts and folios. Joint demat accounts and joint mutual fund folios will continue to treat nomination as optional, but any addition or change of a nominee will require the consent of all joint holders.
Investors who do not want to appoint a nominee will still be able to proceed without naming anyone, provided they complete the prescribed opt-out declaration. The process can be completed through the relevant broker, bank or mutual fund platform by logging into the nomination section and choosing the no-nomination option. The revised rules also allow up to three nominees, with investors able to specify how assets should be divided between them.
If no nominee is recorded, the holdings would pass to legal heirs through the securities transmission process. Upstox and other industry reports say SEBI has also introduced a faster route for smaller claims, including holdings worth up to ₹10,000 in physical form and ₹30,000 in demat form, alongside a simpler documentation process. The revised norms further remove the witness requirement for physical nominations and require depository participants and registrars to send bi-annual nomination reminders to investors.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
