Pursuant to the SEBI circular SEBI/HO/MIRSD/POD-1/P/CIR/2024/81 dated June 10, 2024 folios not complied with the nomination or opt out requirements shall not be frozen for debit transaction. No restrictions will be placed for legacy folios without nomination or opt out. Further, all new folios with single holding capacity needs to mandatorily comply with the nomination or opt out.
The mandatory fields for nomination are:
Nominee name
Nomination percentage (If there are multiple nominees)
Relationship with the first holder.
If nominee is minor, date of birth and guardian name are mandatory.
Some Key points to Note in case of Nomination:
There can be up to Three (3) Nominees under a folio. In case of more than one nominee appointed the percentage, share should be explicitly specified. In case if the same is not specified it is deemed to be 50% each in case of two Nominees and 33%, 33% and 34% respectively.
Minors cannot Nominate.
Unit Holders have the choice of Updating / Modifying nominees in the folio. In case of modification of the existing nomination there should be an explicit consent given by all unit holders in the folio immaterial of the Mode of Holding.
Nomination Form duly filled and signed by all the unit holders (irrespective of mode of operation), specifying the percentage-wise allocation to each nominee in case of more than one nominee.
Note:
Nomination/opt Out mandatory for all Individual / Sole Proprietor- Single Holding folios created new
The percentage allocation should add up to 100%. As per SEBI guidelines maximum 3 nominees will be allowed equal to 100%.
Indian residents which can be nominated:
Individuals;
Minors through parent / legal guardian (whose name and address must be provided)
Religious or charitable trusts;
Central Government, State Government, a local authority or any person designated by virtue of his office.
Nomination shall not be allowed in a folio/ account held on behalf of a minor.
For Joint Holding Investment if Nominee is Minor ‒ 1st Holder may appoint 2nd Holder as Nominee Guardian and Vice Versa.
Non-Individual Entities including HUF, nomination is not allowed.
Nomination form cannot be signed by Power of attorney (POA) holders and every new nomination shall overwrite the existing nomination in the folio/ account.
Investors who hold / who are desirous of holding a folio in Single Mode of Holding capacity and do not wish to nominate any person as a nominee in their folio, must separately on the application form confirming their non-intention to nominate.