How to Add a Nominee in My Demat Account?

Investing in the stock market has become a popular choice for wealth generation. A critical part of setting up a Demat account is ensuring that your investments are easily transferable in unforeseen circumstances. That’s where Demat account nominee registration comes into play.

Adding a Demat account nominee is a straightforward yet significant step for every investor. This provision allows your investments to be seamlessly transferred to your chosen person, should the need arise. Understanding how to add a nominee to a demat account can save your loved ones from unnecessary hassle and ensure your assets are managed as you wish.

Who is the Nominee?

A nominee is an individual you designated who will receive the securities held in your zero brokerage demat account in the event of your unfortunate demise. Think of a nominee as a trustee or beneficiary entitled to inherit and manage your investments, ensuring that your hard-earned assets are passed on correctly.

Nomination Eligibility for Demat Account Holder

Any individual holding a demat account is eligible to nominate. You can nominate a family member, a friend, or a trusted associate. However, it’s critical to keep in mind that:

• Minors can be nominees but require a guardian.
• You can nominate up to three individuals with their specified shares in the assets.
• Corporate bodies cannot be nominated.

The Online Process to Add Nominee to Demat Account

Adding a Demat account nominee online is a hassle-free process facilitated by most depository participants (DPs). Here’s what you need to do:

• Log in to your Demat account: First, visit your DP’s platform and log in to your demat account using your credentials.
• Select ‘Nomination’ in the menu:

  Once logged in, look for a tab that says ‘Nomination.’ This tab will be prominently visible on the homepage of your DP’s website.

• Enter nominee details: On the nomination page, you must enter your nominee’s details, such as name, address, date of birth, and relationship with the account holder. Make sure all the information is accurate and up to date.
• Choose nomination type:

  You can choose from two nominations: ‘ In case of death’ or ‘In case of death or insolvency.’ The former means that the nominee will only be entitled to receive the securities in case of your death, while the latter means they can also claim them if you become insolvent.

• Specify share of securities:

  You can specify the percentage or exact number of securities each nominee is entitled to receive. You can nominate up to three individuals and divide the assets accordingly.

• Fill in guardian details (if applicable):

  If you nominate a minor(s), you must provide the name and address of their legal guardian. This applies to both types of nominations.

• Verify nominee details:

  Before submitting the nomination form, verify all the information provided for accuracy. Any errors could invalidate the nomination.

• Submit nomination form:

  Once satisfied with the details, click the ‘Submit’ button to complete the nomination process. Your nominee(s) will now be registered with your Demat account.

• Keep a copy for future reference:

  It is important to keep a physical or digital copy of the nomination form. This will ensure your wishes are properly documented and followed in unforeseen events.

Must Read: Depository Participant Charges

The Offline Process to Add Nominee to Demat Account

If you prefer handling nominations the traditional way or if your DP does not support online nominations, follow these steps:

• Contact your DP for a nomination form:

  Visit your DP’s office or contact them via phone/email and request a nomination form. Most DPs also have this form available on their websites.

• Fill in all necessary details:

  Carefully fill in all the required details such as your name, address, Demat account number, nominee(s) name(s), relationship with nominee(s), etc. ( Learn how to know your demat account number)

• Enter nomination percentages:

  You can specify the percentage of securities you want to assign to each nominee. This is especially useful for multiple nominees.

• Nominate successor(s): Similar to online nominations, it is advisable also to nominate successors in case the primary nominee(s) cannot receive the securities.
• Sign and date the form:

  Once all necessary details have been filled, sign and date the form in the designated spaces.

• Submit the form to your DP: After completing it, submit it to your DP’s office and any required documents.
• Get acknowledgement receipt: Make sure to get an acknowledgement receipt from your DP as proof of submission.
• Verify details on nomination certificate: Your DP will issue a nomination certificate that contains details of your nominees and their respective percentages. Ensure you carefully verify all the details and inform your DP of any discrepancies.
• Keep the nomination certificate safe: It is important to keep the original in a secure place, such as a safety deposit box, or with your other valuable documents.
• Update nominations when needed:

  Remember to update your nominations in case your circumstances change. This will ensure your securities are passed on to the intended recipient(s) upon your demise.

While the offline process may seem laborious compared to the online method, it’s just as effective in protecting your investments.

Wrapping Up

Making a Demat account nominee is a crucial, albeit often overlooked, aspect of financial planning, especially during demat account opening. It ensures your investments pass on without complication and offers peace of mind, knowing your finances are in order even in adversity. Whether you choose to add a nominee to your Demat account online or offline, taking this step is in the best interest of you and your loved ones.