Rules for Adding a Nominee in Your Demat Account

Mumbai, 01 July 2025: Today, more people are investing in shares, mutual funds, and bonds. All these investments are stored in a Demat Account, which is like a digital locker that keeps your shares safe and in electronic form.

But have you ever thought what happens to your Demat Account if something unexpected happens to you? How will your family get your shares? That’s where a nominee comes in.

In this post, we will explain:

●       What a nominee is

●       Why adding one is important

●       The rules for adding a nominee

●       How to add a nominee to your Demat Account

●       Some common questions people ask

Let’s begin with the basics.

What Is a Demat Account?

A Demat Account is short for “Dematerialised Account.” It holds your shares and other securities in electronic (paperless) form. It is needed when you want to buy or sell stocks online.

To start investing, you need to open a Demat Account online with a stockbroker or financial services company. Once your account is ready, you can buy shares, mutual funds, bonds, etc., which will be stored safely in this account.

What Is a Nominee?

A nominee is a person chosen by you to receive your shares and securities if you pass away. It could be your spouse, child, parent, sibling, or even a friend, someone you trust.

A nominee is not the owner right away, but they will get the legal right to handle your investments if something happens to you.

Why Is Adding a Nominee Important?

Here’s why you should always add a nominee to your Demat Account:

●       Easy transfer of shares to your loved one

●       No need for lengthy legal paperwork

●       Saves time and trouble for your family

●       Keeps your investments safe and in the right hands

●       Gives you peace of mind

If there is no nominee, your family might need to go to court to claim the shares. This can take a lot of time and effort.

Is It Mandatory to Add a Nominee?

Yes. As per the rules from SEBI (Securities and Exchange Board of India), all Demat Account holders must either add a nominee or officially opt out (say they don’t want to add one).

If you don’t do this before the deadline, your Demat Account will be frozen, which means you can’t use it to buy or sell anything.

How Many Nominees Can You Add?

You can add up to 3 nominees to your Demat Account.

If you are adding more than one nominee, you must divide the percentage of shares among them. For example:

●       Nominee 1 – 50%

●       Nominee 2 – 30%

●       Nominee 3 – 20%

Make sure the total equals 100%.

Who Can Be a Nominee?

You can add:

●       Spouse (husband or wife)

●       Parents

●       Children

●       Siblings

●       Friends

Even a minor (child below 18 years) can be a nominee, but in that case, you must also give details of a guardian (usually a parent or adult relative).

You cannot add:

●       A company

●       A trust

●       A society

●       Karta of a Hindu Undivided Family (HUF)

Only real individuals can be nominees.

How to Add a Nominee to Your Demat Account?

There are two ways to add a nominee: online or offline.

1. Online Method

Most brokers now offer the option to add a demat account nominee online. You just need:

●       Your DP ID and Client ID (given when you open your Demat Account)

●       PAN card

●       Aadhaar number

●       Mobile number linked to Aadhaar

Steps:

1.     Go to your broker’s website or app.

2.     Log in to your Demat Account.

3.     Go to the ‘Nominee’ or ‘Update Nominee’ section.

4.     Enter nominee details – name, relationship, address, share percentage.

5.     Do Aadhaar-based eSign with OTP.

6.     Submit.

You’ll get a confirmation once the nominee is added.

If your broker is linked to NSDL, you can visit nsdl.co.in and follow the same steps there.

2. Offline Method

If your mobile is not linked to Aadhaar, you can fill out a nomination form and send it to your broker’s office with:

●       ID proof

●       Signed nomination form

The broker will update your nominee in a few days.

Can You Change or Delete a Nominee?

Yes, you can update, change, or remove a nominee anytime.

To do this:

●       Log in to your Demat Account

●       Go to the nomination section

●       Select ‘Change Nominee’ or ‘Delete Nominee’

●       Submit the changes and do Aadhaar OTP or send a form offline

Common Questions

Q: Can an NRI (Non-Resident Indian) be a nominee?
Yes, you can add an NRI as a nominee, but it must follow foreign exchange rules.

Q: Can joint account holders add a nominee?
Yes, they can, but all joint holders must agree and sign the form.

Q: Can I opt out of adding a nominee?
Yes, you can, but you must submit an official opt-out request online or offline. If you don’t do either, your account will be frozen.

Conclusion

Adding a nominee to your Demat Account is not just a rule, it’s a smart and thoughtful step. It makes sure your investments go to the right person and saves your family from legal problems during tough times. Whether you’re opening a new account or already have one, add a nominee now to secure your future.

If you’re planning to open a Demat Account online, consider platforms like Findoc that offer easy nominee addition, fast onboarding, and reliable service, all in just a few simple steps.