The plain answer
Nomination names the person who receives your holdings if you die, so your family can claim them without a succession certificate or court order. You can name up to three nominees per account, assign the share each receives, and change the nomination any time from the app with the nominee’s PAN and date of birth. The nominee collects and passes on; the legal heirs inherit.
Since 2021, SEBI requires every eligible demat account to record either a nomination or an explicit opt-out declaration, which is why the field sits in the account-opening flow. One minute of setup, and the slowest legal process in finance is off the table.
The mechanics in one line: with a nominee, transmission after your death starts with a death certificate plus the nominee’s KYC. Without one, it starts with a succession certificate or a court order. The nominee field is the difference between the two starting points, and it costs nothing to set.
Why the nominee field exists
Before nomination was pushed into every account, a family claiming a deceased investor’s shares started from zero: prove the death, prove the relationship, prove the inheritance, and only then receive the assets. The nominee field short-circuits that chain by recording in advance who the depository should hand the assets to, which turns the claim into a document check instead of a court process.
SEBI’s July 2021 circular made the choice explicit: eligible demat and trading accounts had to record either a nomination or an opt-out declaration, with new accounts opened from 1 October 2021 required to make the choice at opening. The deadline for existing demat accounts was extended in stages through the 27 December 2023 circular, which set 30 June 2024 as the final date. Depository participants are required to send fortnightly email and SMS reminders to accounts where the choice is still not captured.
The enforcement lever is a debit freeze: an account without a recorded choice risks being frozen for debits until the choice is made. Nomination for trading accounts was made voluntary in the September 2023 circular as an ease-of-doing-business measure, but the demat account framework stays mandatory. The field exists, in short, because the alternative was families losing years to paperwork, and the regulator decided the paperwork should not win.
| Date | What changed |
|---|---|
| July 2021 | SEBI circular requires nomination or opt-out on eligible demat and trading accounts |
| 1 October 2021 | New accounts must record the choice at opening |
| September 2023 | Trading account nomination made voluntary |
| 27 December 2023 | Circular sets the final deadline for existing accounts |
| 30 June 2024 | Final date for existing demat accounts to record the choice |
The timeline explains the reminders that still arrive: the framework was rolled out in stages precisely because tens of millions of existing accounts needed the choice captured, and the depositories used the extension window to chase the stragglers. An account that has recorded the choice receives no reminders; an account that has not still does.
Who can be a nominee
| Nominee | Allowed? | Notes |
|---|---|---|
| Spouse, child or relative | Yes | The common cases |
| Minor | Yes | A guardian is recorded for the minor |
| Friend or unrelated person | Yes | Allowed, though succession still governs ownership |
| More than three people | No | The framework caps at three per account |
The framework is deliberately permissive on who: family, minors with a guardian, and unrelated people all qualify. The restriction is on how many, and on the honesty of the role. A nominee is a conduit, not an owner, so choosing someone for convenience rather than trust creates a problem for your heirs later. The usual choice, spouse or child, is usual for a reason.
One structural exception matters more than any of the permissions: a jointly held demat account does not carry a nomination in the usual sense. The surviving joint holder takes the holdings on the death of the first holder, which is why the joint account structure exists. Nomination is the protection for the sole account; the survivor clause is the protection for the joint one.
The guardian question deserves one clarification, because a minor nominee is a common choice and the guardian field is easy to get wrong. The guardian recorded for a minor nominee is typically the natural guardian, a parent, and the guardian’s details replace nothing about the nominee’s own record. If transmission happens while the nominee is still a minor, the guardian receives and holds for the minor, which is the full extent of the guardian’s role.
How to add or change one
The flow lives in the app’s profile or account services section, and the whole job takes about a minute. You enter the nominee’s name, PAN and date of birth, assign the share percentage, and confirm. A change follows the same steps with the new nominee’s details and takes effect after verification.
- Open the profile or account services section of the broker app
- Choose nomination and enter the nominee’s name, PAN and date of birth
- Assign the share percentage, or split it across up to three nominees
- Record a guardian’s details if the nominee is a minor
- Confirm, then check the nominee line on the next monthly CAS
The confirmation arrives without any extra step: the monthly CAS prints the nominee on every account, so the next statement proves the record. The habit that keeps the nomination honest is one glance at that line whenever the CAS email lands, which is also the habit the CAS guide recommends.
If the app flow fails for any reason, the fallback is the physical nomination form from the broker or depository, which asks for the same fields. The online route is the default because it verifies you in the session itself; the paper route verifies you afterwards, which is why it takes longer.
The economics of the whole exercise: adding or changing a nominee is free at the major brokers, takes about a minute online, and shows up on the next monthly statement. It is the cheapest piece of succession planning available anywhere in the financial system, and the pages in this guide return to it for exactly that reason.
What the nominee needs
| Item | What is recorded | Notes |
|---|---|---|
| Name | Full legal name of the nominee | As it appears on their PAN or records |
| PAN | The nominee’s PAN | A mandatory field on the nomination form |
| Date of birth | The nominee’s date of birth | Required for depository records |
| Guardian details | Only when the nominee is a minor | Name and relationship of the guardian |
| KYC documents | Not required now | Collected only if transmission is triggered |
The two facts to remember: the nominee’s PAN is mandatory, and their KYC is not required until the nomination is actually triggered. That split is what keeps the process to one minute today. The nominee does not sign anything and does not visit anywhere; the record is entirely yours to create and change.
One accuracy note saves a failed transmission later: enter the name exactly as it appears on the nominee’s PAN. A nickname or a spelling difference is a mismatch the depository may flag at transmission time, which is precisely the moment you do not want a mismatch to appear.
Three nominees and share percentages
The three-nominee cap comes with a share allocation, and the percentages are yours to set. You can name one nominee at 100%, or split the holdings 50-50 between two, or divide across three in any proportions you choose. The depository applies the percentages at transmission time.
If the assigned shares total less than 100%, the remainder passes to the legal heirs through the normal succession route, which is the framework’s answer to the person who wants to nominate partially. The cleanest setups are the simple ones: one nominee at 100%, or an explicit split you have written down somewhere your family will find it.
| Split | Result at transmission |
|---|---|
| One nominee at 100% | The nominee receives everything and passes it on to the heirs |
| 60 / 30 / 10 across three | Each nominee receives their assigned share |
| 50 / 25 with 25% unassigned | Two nominees receive their shares; the remaining 25% passes through succession |
A concrete example: you hold 1,000 shares and split the nomination 60-30-10. At transmission, the first nominee receives 600 shares, the second 300, and the third 100, each as a custodian for the heirs. The percentages apply to the holdings as they exist at the time of transmission, so a split set today scales with whatever the account holds later.
One more mechanical fact about the percentages: the record covers the account as a whole, not a list of securities. Shares, ETFs, bonds, mutual fund units held in demat form, everything in the account splits by the same percentages at transmission. You cannot assign stock A to one nominee and stock B to another; the split is across the account, not across its contents.
What the nominee does when it matters
The nomination you set today becomes the nominee’s job on one specific day, and the job is small and concrete. The full mechanics live on the transmission page; the nominee’s part of it is four steps:
- Intimate the DP with the death certificate, which freezes the account for debits.
- Complete their own KYC and the DP’s transmission form, which is why the nominee’s PAN was collected at nomination time.
- Receive the holdings in their own demat account, split by the recorded percentages.
- Distribute to the legal heirs according to succession law or the will, because the nominee collected, they did not inherit.
Read that last step twice when choosing a nominee. The person you name is the person who collects the assets and passes them on, which makes the choice one of reliability first and relationship second. A nominee who resists the handing-over step converts a smooth process into a dispute between the family and the nominee, and the courts then decide what a different choice could have avoided.
Nominee vs legal heir
The nominee is a custodian of the assets for the legal heirs, not necessarily the final owner. Courts have repeatedly restated this: nomination smooths the transfer; succession decides the ownership. If the nominee is also an heir, the two roles merge in one person. If not, the nominee must pass the assets to the heirs.
The field exists to remove the procedural delay, not to rewrite inheritance, which is why a will still matters where the family’s wishes differ from the default succession. Think of the nominee as the courier and the will as the label on the package: both do different jobs, and families that set both move fastest.
The opt-out option
SEBI rules require depositories to record either a nominee or an explicit opt-out declaration, and opting out is a legal choice. Some choose it because their will handles distribution, or because the estate structure makes nomination awkward. The framework accepts the choice; it only refuses silence.
The cost of the choice is procedural: without a nominee, the heirs start from the succession certificate or similar documents even when the will is clear. The nominee field and the will are not rivals; they are layers, and keeping both costs almost nothing. An opt-out that sits in the record is still better than a blank, because the blank is what attracts the freeze.
Opting out is recorded in the same app section as the nomination itself, and it can be reversed later. The record keeps the account compliant either way, which is the point: the regulator wants a decision on file, not a particular decision.
The mechanics of the choice are worth knowing before you make it. Recording an opt-out is a declaration in the same profile flow, needs no documents beyond the session verification, and switches the account from the nominee route to the succession route for good until you change it back. The change is reversible in one app session, but the transmission process it selects is not: the route that exists on the day of death is the route the family walks.
Edge cases
- Joint accounts. Nomination does not apply to a jointly held account. The surviving holder takes the holdings after the first holder’s death is registered with the DP. Check the joint account guide for the survivor-clause mechanics.
- The nominee dies before you. A deceased nominee cannot receive anything, so the record becomes useless the moment it is needed. Replace the nominee promptly when one dies. This is the most common stale-record failure.
- Each account needs its own record. Nomination is per account, not per person. If you hold accounts at three brokers, all three need the nomination captured, because the debit-freeze framework checks each one individually.
- A minor nominee grows up. Nothing needs updating while you are alive. If transmission happens while the nominee is still a minor, the recorded guardian receives and holds for the minor. If the nominee has turned 18 by then, they receive directly.
When to revisit the nomination
The nomination that stays correct for a decade is rare. Life moves, and the field moves with it in one minute per change. The events that should trigger a look at the nominee record:
- Marriage. Add the spouse as nominee, or switch the allocation if the account predates the marriage.
- Birth of a child. Add the child as a second or third nominee, with a guardian recorded.
- Divorce. Remove the former spouse. The nomination stays valid until you change it, and a stale spouse-as-nominee record is a conflict waiting to happen.
- Death of the nominee. Replace the nominee immediately; a deceased nominee cannot receive.
- A new will. Read the nominee split against the will. Nomination does not override the will, but a mismatch between the two adds friction at the worst moment.
The cheapest version of this discipline is the yearly check: once a year, when you review the CAS, glance at the nominee line. If the name there still matches your current life, the record is current. If not, the fix is one app session.
What people usually get wrong
The nominee owns the shares automatically
The nominee holds for the heirs. Ownership follows succession law, and courts have restated this repeatedly.
Nomination is a one-time formality
It is changeable any time, and it needs changing when life changes: marriage, divorce, birth. The stale nominee is the common failure.
A will makes nomination unnecessary
The will decides ownership; the nominee removes the procedural delay. Families with both move fastest.
I can nominate as many people as I like
The framework caps at three nominees per account, with share percentages assigned to each.
The nominee must sign or consent to the nomination
The nomination is the account holder’s instruction. The nominee is not part of the flow, and their role begins only if transmission is triggered.
Questions people ask
Up to three per demat account under the SEBI framework, with the share of holdings assigned to each. If the assigned shares total less than 100%, the remainder passes to the legal heirs. More than three is not permitted. The cap applies to each account separately, so three accounts would each carry their own nomination record.
The nominee’s PAN and date of birth, plus a guardian’s details if the nominee is a minor. The nominee does not complete KYC at the time of nomination; that happens if and when the nomination is triggered. The nominee also does not need to sign or consent at the nomination stage, because the nomination is your instruction recorded against the account.
Yes, any time, from the app, with the new nominee’s PAN and date of birth. The change takes effect after verification, and the updated nominee prints on the next CAS. You can also cancel the nomination entirely and record an opt-out instead, though that switches your family onto the slower succession route.
No. The nominee receives and holds the assets for the legal heirs. If the nominee is also an heir, ownership follows succession; if not, the nominee must pass the assets on. A will, where one exists, governs the final distribution. Courts have restated this position repeatedly, which is why nomination is described as a transfer of custody, not ownership.
Under the SEBI framework that has applied since 2021, eligible demat accounts must record either a nomination or an explicit opt-out declaration. Accounts where the choice is not captured risk a debit freeze until it is recorded, and depositories are required to send fortnightly reminders by email and SMS to accounts missing the choice. The final deadline for existing demat accounts was 30 June 2024, so an account without a recorded choice today is an account behind on a mandatory field.
Yes to both. A minor can be nominated, with a guardian recorded for the minor; if transmission happens while the nominee is still a minor, the guardian receives and holds for the minor. An unrelated person can also be nominated, but nomination does not rewrite succession: the nominee holds for the legal heirs, so the friend would collect and pass on, not keep.
Sources
- Securities and Exchange Board of India. “Legal framework , circulars,” nomination framework for demat accounts (July 2021), the September 2023 trading-account circular and the deadline extensions through the 27 December 2023 circular. Accessed 16 August 2026.
- National Securities Depository Limited. “Official website , depository services,” nomination documentation. Accessed 16 August 2026.
- Central Depository Services (India) Limited. “Official website , depository services,” nomination documentation. Accessed 16 August 2026.
- Upstox. “Open a free Demat account,” nomination and account-opening flow. Accessed 16 August 2026.