Don't miss out on the deadline! Here’s how to add a nominee to your demat account

The Securities and Exchange Board of India (SEBI) has granted a reprieve to existing eligible trading and demat account holders by extending the deadline to nominate a beneficiary for their accounts till March 31, 2023.

After considering feedback from stakeholders, SEBI had earlier issued a circular on July 23, 2021 that mandated all existing eligible trading and demat account holders to provide the choice of nomination as per the given option on or before March 31, 2022, failing which their trading accounts would be frozen for debits.

However, in February 2022, they announced an extension of the deadline to March 31, 2023, providing them with additional time to make their nominations. Those who fail to do so by this date will have their trading and demat accounts blocked for debits.

What is a demat account?

A demat account is an account that holds your financial assets in electronic form instead of physical form. It is a secure and convenient way to keep track of your investments such as shares, mutual funds, bonds, etc. It is linked to your bank account and allows you to transfer money from one account to another electronically.

The primary benefit of having a demat account is that it provides easy access to all your financial assets in one place. It ensures that the process of buying, selling, and transferring these assets is fast, efficient, and secure. Additionally, it eliminates the need for paperwork related to transactions. A demat account also allows you to check your holdings and view the current market value of your investments.

What is a nominee?

A nominee is someone who will manage your demat account if something happens to you. This means that they will have the authority to manage your investments and receive any proceeds due to you. The nominee is chosen by the demat account holder.

Having a nominee is important because it ensures that your investments are managed properly even in your absence. In case of your death or incapacitation, the nominee will be able to make decisions about your investments and receive any proceeds due to you. This ensures that your money is not lost in the event of your demise.

How to add a nominee to your demat account?

1. The first step to adding a nominee to your demat account is to visit the website of the National Securities Depository Limited (NSDL) and log in using your credentials.
2. Once you have logged in, you will need to click on “Update Personal Details” under the “Demographic Change” section.
3. On the next page, select the radio button “Add/Update Nominee Details”.
4. You will then need to enter all the required details of the nominee on the next page. Once the information is filled out, click on the “Save” tab and then the “Submit” tab.
5. An OTP will be sent to the registered mobile number of the investor. You will need to enter the OTP in order to proceed.
6. After entering the OTP, you will need to click on “eSign and Download”. Note the service charges and click on the “Proceed” tab.
7. In order to complete the process, you will need to enter either your VID (Virtual ID) or your Aadhaar number. After entering the details, click on the “Verify OTP” tab.
8. Once the process is completed, you will receive a “modification successful” message along with an acknowledgment number.

Adding a nominee to your demat account is an important step in protecting your investments. It ensures that your investments are safeguarded and that there is a legal heir who can receive the benefits of your investments in case of death. By following the steps outlined in this article, you can easily add a nominee to your demat account.