Investors now have an extended deadline until June 30, 2024, to complete their nomination process for mutual fund (MF) and demat accounts, as announced by the Securities and Exchange Board of India (SEBI) in a circular issued on December 27. According to a circular released on December 27, the regulatory body has prolonged the deadline to June 30, 2024. Investors are required to either select a nominee or expressly decline the nomination by providing a declaration. The extension aims to facilitate compliance and enhance investor convenience, as per SEBI’s announcement. The earlier declared deadline was 31st December 2023.
Key highlights
? Extended Deadline: SEBI grants investors an extended window until June 30, 2024, to complete mutual fund and demat account nominations.
? Importance of Nomination: Understand the pivotal role a nominee plays in the smooth transmission of assets to the next of kin, ensuring your financial legacy.
? Previous Extensions: SEBI’s proactive approach in addressing investor challenges, extending deadlines to accommodate the completion of the nomination process.
? Nomination Process Demystified: Learn the step-by-step process to update nominations for singly-held and jointly-held MF folios through online platforms or physical forms.
? Investor Convenience: SEBI’s decision aims to provide ease of compliance and enhance convenience for investors in managing their financial portfolios.
? Critical Insights: Gain valuable insights into the significance of timely nomination completion and the potential consequences of missing the deadline.
Deadline for Demat and Mutual Fund Nomination Extension Details
SEBI, the securities market regulator, has decided to extend the deadline in response to representations from market participants. The new deadline provides investors with additional time to either choose a nominee or explicitly opt out of the nomination by submitting a declaration. This move aims to facilitate compliance and enhance investor convenience.
Previous Extensions
This is not the first time SEBI has extended the nomination deadline. Initially set for September 30, the deadline was previously pushed to December 31. The extension is crucial for investors who risked having their MF folios or demat accounts frozen for debits if they failed to complete the nomination process on time.
Importance of Nomination
A nominee plays a crucial role in asset transmission to the next of kin in case of the investor’s demise. SEBI had made nomination mandatory for new MF investments from August 1, 2022, with a deadline for existing investments set at March 31, 2023.
Current Scenario and Deadline Reminders
As of September-end 2023, approximately 25 lakh PAN holders had not updated their nomination, according to the registrar and transfer agent (RTA) CAMS. With the latest extension, investors must finalise their nominations by June 30, 2024, to avoid freezing their MF folios for debits.
How to Add a Nominee for Your MF Folios
- For Singly-Held Folios: Updating nominations for singly-held MF folios can be done online through platforms. Physical nomination forms can also be submitted.
- For Jointly-Held Folios: Updating nominations for jointly held MF folios may require consent from all joint holders. Online updates require authentication via OTPs from all joint holders.
- Using Mutual Funds Utility (MFU): New investors can use MFU to fill in nomination details online. Existing investors, however, must use physical nomination forms.
- Submitting Physical Forms: Investors with investments in one fund house can download forms from the respective website. Those with investments across multiple fund houses can download forms from relevant RTA websites.
Important Signature Note: When opting for the offline route, ensure your signature matches, as signature mismatch can lead to form rejection.
Act promptly to complete your MF nominations before the June 30, 2024, deadline to avoid any disruptions in your investments.
Source- moneycontrol.com
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