If investors fail to add nominations by March 31, 2023, their demat accounts may be frozen. All owners of demat and trading accounts are required by the Securities and Exchange Board of India (SEBI) to have a nominee. The deadline for the same was originally set for March 2022, but Sebi extended it by an additional year in response to suggestions and comments from various stakeholders.
In July 2021, Sebi asked all existing eligible trading and demat account holders to provide a choice of nomination.
Existing investors do not need to submit their nomination information again if they have previously done so. Individuals who have not yet submitted their nomination details but plan to do so or choose not to be nominated may also do so.
How to add nominees?
By logging in with two-factor authentication on trading platforms for stock brokers or depository participants who provide this service, investors can submit or withdraw their nominations.
The previously required information—such as a mobile number, email address, and identification information for the candidate or the nominee's guardian of a minor—has been changed to an optional field.
There is a declaration form that the account holder must sign. As long as the account user uses a fingerprint rather than a signature, no witness signature is needed when filling out nomination or declaration forms online using the e-sign feature.
Steps to add a nominee to the demat account
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First, log in to the demat account.
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Go to 'Profile segment' and navigate to 'My nominees'.
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Choose 'add nominee' or 'opt-out'.
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Fill details and upload an ID proof of the nominee.
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Enter the nominee share in percentage.
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E-sign the document with Aadhaar OTP. The details of the nominee will be processed.
Number of Nominees that can be nominated
A maximum of three nominations are added to an investor's demat account. Also, they can give each candidate in the account a percentage. For instance, if a person wishes to add three nominations, he or she can distribute 50% to No. 1, 30% to No. 2, and 20% to No. 3.
Who can be a nominee?
One can nominate their mother, father, spouse, siblings, children, or anybody else. If the guardian's information is given, a minor can also be added as a nominee.
