SEBI mulls easing nomination norms for demat, MF accounts

New Delhi: India’s market watchdog, the Securities and Exchange Board of India, on Tuesday issued a consultation paper proposing changes to nomination norms for demat accounts and mutual fund folios, seeking public comments.

The regulator said the proposals aim to modify its January 10, 2025, circular on nomination facilities in the securities market to improve the ease of investor onboarding and align processes with banking norms.

Under the existing framework introduced last year, single-holding investors were allowed to authorise one nominee (excluding minors) to operate their accounts in case of physical incapacitation, provided they remain mentally capable of contracting.

However, nominees are not permitted to update key account details such as bank information or contact details.

The current rules also mandate investors to provide at least one personal identifier of the nominee, such as PAN, driving licence number or the last four digits of Aadhaar, along with full contact details, relationship status, and date of birth in case of minors.

Investors can nominate up to 10 persons in a mutual fund folio, while Power of Attorney (PoA) holders are not allowed to nominate.