Sebi rolls back MF nomination norms

Securities and Exchange Board of India (Sebi) has rolled back key aspects of its January 2025 framework overhauling nomination rules governing demat accounts and mutual fund (MF) folios, after acknowledging in March challenges in the new system that sought to reduce unclaimed investor assets.

- Apoorva Ajith

In a circular issued on Friday, the markets regulator reverted to its previous framework. The January 2025 framework aimed to “revise and revamp” nomination facilities across the securities market, but many of its proposals were cumbersome in practice.

The new norms included a rule to allow nominees to operate accounts of incapacitated investors, mandatory capture of extensive nominee details, video-based opt-out processes for investors unwilling to nominate, and an increase in the maximum number of nominees from three to 10 per account.