SEBI nomination rules change on 1 September 2026

What actually changes

SEBI has revised the nomination framework for demat accounts and mutual fund folios, with effect from 1 September 2026. The revised rules supersede the earlier circulars.

The headline is that nomination becomes effectively mandatory for new single holder accounts and folios. You either name a nominee or submit a formal opt out declaration. The field cannot be left blank.

For jointly held accounts and folios, nomination stays optional, and any addition or change needs the consent of all the joint holders.

The part that got easier

This is the more interesting half, and it is being reported less. The documentation burden has dropped sharply.

• Only the nominee name and relationship to you are now mandatory.
• PAN, Aadhaar, passport number, email and mobile became optional. These were previously demanded for every nominee.
• A date of birth is still required if the nominee is a minor.
• No witness is needed for a normal signature. A witness is required only where a thumb impression is used, in which case two are needed.
• You can name up to three nominees, each with a percentage share.
• Nominations can be modified, updated or cancelled any number of times.

If you previously abandoned a nomination form because it wanted identity documents for three relatives, that obstacle has largely gone.

Why SEBI is pushing on this

India holds a very large quantity of unclaimed financial assets, and a meaningful share of it exists because a single form was never completed.

When an investor dies without a nominee on record, the family faces a legal process to claim what is already theirs. Succession certificates, court time, legal cost, and delays measured in months. The money sits frozen throughout.

The task that prevents all of that takes about two minutes. It is skipped because it is dull and because thinking about it is unpleasant. Those are the only two reasons.

One distinction worth getting right

A nominee is authorised to receive the assets when you die. Their role is to make the transfer straightforward, so the institution knows who to hand things to without a court instructing it.

Who ultimately owns those assets is decided by your will, or by the succession law that applies to you if there is no will. A nominee can end up holding assets on behalf of the legal heirs rather than keeping them.

What to do this month

• Check your existing demat account. The mandatory requirement targets new accounts, but if yours has no nominee there is no reason to wait, and the process has just been simplified.
• Check each mutual fund folio. Doing it through the registrar, such as CAMS or KFintech, covers all folios with the fund houses they service at once.
• Check your bank accounts and deposits separately. Those follow banking rules rather than SEBI ones.
• Check EPF and NPS. Separate again.
• Tell someone the accounts exist. A perfectly completed nomination is useless if nobody knows to look.

That last point is the one families actually get caught by. A written list of where things are held, kept somewhere your family can find it, is worth more than any form.

Full detail in the lesson: nomination and succession.