SEBI Extended Deadline for Implementation of Nomination Framework

Current Context: SEBI’s extended deadline for the Nomination Framework, as per its circular dated 30 July 2025.

• To enhance transparency and reduce unclaimed assets in the securities market, SEBI introduced a revamped Nomination Framework for mutual fund folios and demat accounts.
• Due to operational challenges faced by depositories and industry stakeholders, SEBI has now extended the implementation timeline for its phased rollout.

Key Highlights

• Phase II Deadline: Extended from June 1 to August 8, 2025.
• Phase III Deadline: Deferred from September 1 to December 15, 2025.
• Rule of Survivorship: Assets in joint accounts will transfer to surviving holders without additional KYC.
• Nomination Cap: Investors can nominate up to 10 persons, with optional percentage allocation.
• Legal Clarity: Nominees act as trustees, not legal heirs; assets distributed pro rata if a nominee predeceases the account holder.
• Submission Modes: Nomination updates allowed via digital and physical channels.

Question:

Q.1 According to SEBI’s updated framework, what is the maximum number of nominees allowed per demat or mutual fund account?
a) 3
b) 5
c) 7
d) 10

Answer: d) SEBI has allowed investors to nominate up to 10 individuals for a single account. Percentage-wise allocation is optional.