Investors opening new trading, demat account from October to get choice of providing nomination: SEBI

Markets regulator SEBI on Friday said investors who are opening new trading and demat account from October 1 will have the choice of providing nomination or opting out nomination.

Also, the regulator has issued a format for nomination form and opting out of nomination through a 'declaration form' in this regard, according to a circular.

Further, all existing eligible trading and demat accountholders will have to provide choice of nomination by March 31, 2022, failing which the trading and demat accounts will be frozen, SEBI said.

Under the new framework, trading members and depository participants will activate new trading and demat accounts from October 1, 2021, only upon receipt of such forms.

The nomination and declaration form will be signed under wet signature of the accountholder and witness will not be required.

However, if the accountholder affixes thumb impression (instead of wet signature), then witness' signature will be required in the forms.

The online nomination and declaration form may also be signed using e-sign facility and in that case witness will not be required.

Intermediaries will have to ensure that adequate systems are in place including for providing e-sign facility and also take all necessary steps to maintain confidentiality and safety of client records.