The National Securities Depository Limited (NSDL) on October 19, 2026, notified the amendment to the NSDL Business Rules pursuant to the SEBI circular regarding Modified Norms for Nomination in Demat Accounts and Mutual Fund Folios.
The following has been stated:
• The amendments introduce new Business Rule 12.5A and revise Rules 4.5.4.2 and 12.6.3.1 to 12.6.3.2, covering nomination procedures, joint-account operations and transmission of securities. Under the new Rule 12.5A, physical nomination forms shall bear the wet signatures of account holders, while witness signatures are not required for physically signed forms unless the nomination is executed by thumb impression, in which case witness attestation is necessary. The nominee’s name and relationship with the account holder are mandatory details, along with the date of birth where the nominee is a minor; address, mobile number, email, PAN/Aadhaar or other identifiers, percentage allocation, and guardian details are optional. Account holders may modify or cancel nominations any number of times, subject to authentication requirements, and the latest valid nomination recorded by NSDL will supersede earlier nominations. Depository Participants (DPs) shall acknowledge nomination-related requests, reflect nomination status in account statements and prescribed communications, maintain electronic records and audit trails, and periodically communicate with account holders who have neither registered a nomination nor submitted an opt-out declaration, wherever applicable.
• The amendments further permit nomination requests for joint demat accounts to be processed according to the selected mode of operation, including by the first holder, jointly or by any one holder or survivor, as applicable. Revised Rule 12.6.3.1 provides for nomination in favour of up to three nominees or opting out of nomination through the prescribed form; nomination or opt-out is optional for jointly held demat accounts but becomes mandatory if the account changes to a single-holder account. Under Rule 12.6.3.2, where multiple nominees are appointed, the account holder shall specify each nominee’s percentage share totalling 100%; if no allocation is specified, the securities are divided equally.
• The rules also prescribe documentation and procedures for transmission of securities following the death of the sole account holder or all account holders, including the transmission request form, death certificate, nominee’s PAN and Client Master Report, and additional documents for minor nominees or guardians, where applicable. Securities shall generally be distributed according to the registered entitlement, with indivisible securities allotted to the nominee named first in the prescribed form. Nominees receive the securities as trustees of the deceased’s legal heirs, and nomination records shall be maintained and reconciled by the relevant entities.
[Notification No. - NSDL/POLICY/2026/0158]
