The last day for specifying nominee details in Mutual Funds (MFs) is March 31, 2023, failing which an individual mutual fund unitholder will have their investments frozen and cannot transact in them.
Securities and Exchange Board of India (SEBI) in its circular in June 2022, made the nomination mandatory for the existing mutual fund folios, including the jointly-held ones and made compulsory for the new MF unitholders to submit either the nomination form or the declaration that they are opting out of nomination.
An individual mutual fund unitholder can nominate a person to claim his/her funds or the redemption proceeds thereof in in the tragic case of his/her death. When units are held by more than one person jointly, all joint unit holders can nominate a person to whom all rights in the units would transfer upon their death. They can also opt out of the nomination.
The industry offers multiple channels for investors to complete the process. The Asset Management Companies (AMCs) have also been directed to provide both an online and an offline facility to unitholders to choose their nominees or opt out of nomination. Unitholders can submit their choices in a specified form either with the fund houses, registrar, or the transfer agents.
The nominations can also be changed in the accounts held with online platforms or by writing to the fund house.
(With inputs from agencies)
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