On May 6, 2025, IND NSD issued changes in introducing new operation modes for joint accounts, allowing options like either or survivor, jointly, first named holder only.
New flag for nomination details in statements is added, distinguishing between registered,not registered nominations; nominee details require personal identifiers, full contact information, relationship status, and date of birth if the nominee is a minor.
UDiFF catalogue is updated with new ISO tags; account holders can nominate, opt-out, or alternatively leave details blank, while joint account holders have flexible options.
Common standard operating procedures will be introduced for clients with special needs; demat accounts can now be opened for associations of persons (AOP).
Participants must implement necessary back-office system changes before May 31.
Document dated May 6, 2025, received from IND NSD May 7, summarized May 8.
On Feb. 2, IND SEBI proposed to revise/revamp nomination facilities.
IND SEBI issued consultation paper to revise and revamp nomination facilities in the Indian securities market; aims to aid in reduction of unclaimed assets as well as smoothen process for surviving family/beneficiaries/successors of deceased investors.
Proposal
Proposed revisions to nomination facilities for securities (shares, bonds, units of REITs/InvITs/AIFs, other securities) held in dematerialized form in a demat account, and units of mutual fund schemes held in non-materialized form/statement of account.
So as to provide convenience to investors in Indian securities market, uniformity in facilities and procedures, affording certain choices/flexibilities in nomination facilities.
Such revised, revamped nomination facilities will operate without affecting prevalent systems of law governing transmission and succession, re rule of survivorship (joint ownership/holdings); when person died leaving will; and when person died intestate.
Consultation Period
Comments must be submitted via online form by Mar. 8, 2024.
Mar. 2024 Timeline Extended
On Mar. 8, 2024, IND SEBI extended the timeline for submission of comments on the consultation detailed above to Mar. 28, 2024, and provided instructions re submission.
Jan. 2025 Circular Issuance
On Jan. 10, 2025, IND SEBI issued circular re demat accounts, fund folios nomination.
Nomination mandatory for single holdings, optional for joint accounts; investors can nominate up to 10 persons and must specify percentage share for each nominee.
Nominees must provide personal identifier (PAN/driving license/Aadhaar), contact details, relationship details; KYC completion during investor lifetime made optional.
Power of attorney (POA) holders cannot make the nominations for investors.
Regulated entities must provide both online and physical nomination options; online nominations require digital signature, Aadhaar e-sign, or two-factor authentication.
Physical nominations need signature verification and witness attestation for thumb impressions; entities must acknowledge all nomination submissions, maintain records for 8 years; periodic statements must show nominee name, status per investor choice.
For joint accounts, the assets transfer to surviving holders through name deletion; upon simultaneous death of joint holders, the assets go to nominees or legal heirs.
Nominees receive assets as trustees on behalf of legal heirs; transmission to nominees requires only death certificate and nominee KYC completion; regulated entities must facilitate transfer from nominees to legal heirs when the process is requested.
Circular will be effective from Mar. 1, 2025.
Feb. 2025 IND CDSL, IND NSD Phased Implementation
On Feb. 28, 2025, IND SEBI issued amendments and clarifications to its circular dated Jan. 10, 2025 on revise and revamp nomination facilities, as detailed above.
Clarifications have been made pursuant to the representations received from various stakeholders, and amendments are made to specified provisions of the circular.
The amendments are largely technical in nature, but key changes give effect to SEBI's decision to implement the circular in 3 phases, instead of wholly from Mar. 1, 2025.
In addition to the Mar. 1, 2025 implementation date, specified clauses of the circular are to be implemented on Jun. 1, 2025 (phase II) and Sep. 1, 2025 (phase III).
On the same day, IND CDSL, IND NSD notified participants of phased implementation.
May 2, 2025 IND CDSL System Changes
On May 2, 2025, IND CDSL said several system changes will be implemented for beneficial owner (BO) upload related to nominations and account modifications.
Nominee details (name, address, phone) must be mandatorily captured; at least one ID (PAN, Aadhaar, driver's license, passport, OCI/PIO) will be required for NRIs.
BOs can choose to display nominee name or status in account statements; existing joint account modes remain unchanged after deletion, unless modified.
DPs must capture the account closure source, BSDA modification reason, client consent date for BSDA opt-out, and date of intimation of the account holder’s demise.
These changes are effective from May 31, 2025.
May 6, 2025 IND NSD Changes in UDiFF
On May 6, 2025, IND NSD issued changes in introducing new operation modes for joint accounts, allowing options like either or survivor, jointly, first named holder only.
New flag for nomination details in statements is added, distinguishing between registered,not registered nominations; nominee details require personal identifiers, full contact information, relationship status, and date of birth if the nominee is a minor.
UDiFF catalogue is updated with new ISO tags; account holders can nominate, opt-out, or alternatively leave details blank, while joint account holders have flexible options.
Common standard operating procedures will be introduced for clients with special needs; demat accounts can now be opened for associations of persons (AOP).
Participants must implement necessary back-office system changes before May 31.
Document dated May 6, 2025, received from IND NSD May 7, summarized May 8.
Regulators
IND CDSL; IND NSD; IND SEBI
Entity Types
B/D; CNSM; Exch; Fiduciary; IA
Reference
Nt NSDL/POLICY/2025/0058, 5/6/2025; Cir CDSL/OPS/DP/POLCY/2025/289, 5/2/2025; Cir NSDL/POLICY/2025/0030, Com CDSL/OPS/DP/POLCY/2025/145, Cir SEBI/HO/OIAE/OIAE_IAD-3/P/ON/2025/0027, 2/28/2025; Cir SEBI/HO/OIAE/OIAE_IAD-3/P/ON/2025/01650, 1/10/2025; PR 3/8/2024; CP 2/2/2024
