Retail investors buy or sell shares through Demat account only. But, now after a circular of SEBI, it is mandatory for all demat account holders to complete one task. A deadline has also been fixed for this.
If you buy or sell shares in the stock market then you must have a demat account. But, now you have to complete one important task regarding this demat account. Its deadline is approaching. If you do not complete this work in time, the demat account will be frozen, meaning you will not be able to buy or sell shares. Actually, now nomination in demat account has become mandatory. For this you will have to choose one of two options. Firstly, you can add a nominee in your demat account or the second option is that you can choose not to choose a nominee.
However, if an existing investor has already provided nomination details, he will not have to provide the same again. Nomination details can be filled online through stock brokers or depository participants through two-factor authentication (2FA). Further we are giving its complete information.
Deadline for filling nominee details in demat account
In a circular issued by market regulator SEBI on March 27, 2023, it has been said that the accounts of demat accounts where nominee details have not been provided will be frozen on September 30, 2023. This means that till September 30, 2023, those demat accounts which do not have nominee details will not be able to buy or sell shares.
Nomination in Demat account can be completed online from home through NSDL. This is a facility for Indian citizens. Individuals who have a demat account can fill the details of maximum 3 nominees.
Process to fill nominee in NSDL demat account
Step 1: Login by clicking on https://eservices.nsdl.com/instademat-kyc-nomination/.
Step 2: After this enter < DP ID > + < Client ID > + < PAN >. OTP will come on the mobile registered with the demat account, after filling which you will have to authenticate.
Step 3: Here you click on ‘Nominate’ or choose Opt Out option.
Step 4: OTP will come on the mobile number registered with UIDA, through which this process will have to be completed.
Some important things related to nomination
Can joint holders also nominate
Yes, nomination facility is available in joint holders accounts also. However, if one of the joint holders dies and the other person survives, the securities will be transferred only to him. When all the joint holders die. Only then will the security be transferred to the nominee.
Who can be made nominee?
A nominee can be only one person. Society, trust, corporate body, partnership firm, HUF etc. cannot be made nominee for demat account.
There can be more than one nominee?
Yes, at present three different nominees can be named in one demat account. If 2 or 3 nominees have been named, it should also be mentioned how much share will be transferred to any nominee. After the death of the demat account holders, the security can be transferred to all the nominees in the same proportion.
What is the process for appointing a nominee?
The demat account holder will also have to provide information about his relationship with the nominee. This information has to be given at the time of opening the account only. If nomination has not been made at the time of opening the account, it can be filled later also. Nominee details can also be changed later.