For someone who is on the investment train, a demat account provides a safe and secure vault for all important documents representing the ownership of an asset. These accounts have facilitated stock trading by simplifying the process and promising a quicker and faster investment experience.
In addition to offering a vault to hold investment documents, a Demat Account allows the account holder to register a nominee. This works just like your bank account and is a reliable step to safeguard your investments in case of an unfortunate event. Read on to find everything you need to know about nominee registration in a Demat Account.
What is a Nominee in a Demat Account?
Before you move ahead with the process of registering a nominee, it is important to understand what a Demat account nominee is.
A nominee is the person to whom you vest the power of holding all the securities in your Demat Account in case you meet an unfortunate event like death.
The nominee acts like the custodian of the Demat Account till the account holder is alive and receives all the power to manage and transmit securities of the account at the demise of the account holder. This makes it extremely important to choose a nominee wisely.
Register a Nominee in a Demat Account in Easy Steps
Here’s how you can easily register a Demat account nominee:
- Visit the official website of your Depository Participant and select the “Nomination Online” window from the homepage.
- Fill in the necessary details like DP ID and Client ID.
- You will be redirected to a page where you can select the “I wish to nominate” window and fill in the nominee’s details.
- Once you submit the necessary details you will be redirected to the Protean eGov page. This is where you have to complete the Aadhar e-signature step.
- Once you are done with the Aadhar E Signature, you will receive an OTP for authentication.
- Fill in the OTP and you have successfully registered a nominee.
Nominee Registration in a Demat Account: Things You Must Know
Here’s a list of questions to help you resolve all your doubts regarding nominee registration in a Demat Account:
- What Are The Eligibility Criteria For Nominees?
Here’s a list of persons who can be registered as a nominee:
- Any individual including friends and family members.
- A minor can also become a nominee, provided that their guardian details are submitted.
- A nominee has to be a natural person and not a legal person.
- Is It Mandatory To Register A Demat Account Nominee?
Yes, as per the SEBI’s, Security and Exchange Board of India, instructions, every Demat Account holder must register a nominee before 30th June 2024 to avoid freezing of their account.
- Why Is It Important To Register A Nominee In A Demat Account?
Registering a nominee for your Demat account has multiple benefits like a seamless transfer of securities in case of an unfortunate event, elimination of beneficiaries for the probate process and peace of mind as you have built financial support for your loved one for the future.
- How Many Nominees Can Be Added To One Account?
As per the SEBI guidelines, a demat account can have a maximum of 3 nominees. These nominees can be the primary account holder’s family or friends.
Wrapping Up
Demat Account India has practically implemented paperless stock trading by ensuring a safe and secure storage of all investment documents. In addition, this also helps an account holder eliminate the risk of theft or forgery. With an option to register a nominee, the Demat account holder can live peacefully knowing that their securities will conveniently be transferred to a trustee person.
To ensure a seamless experience it is crucial to choose a reliable platform like Bajaj Online Trading that offers multiple features including reduced costs, personalised suggestions and quick updates on investments made.
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