InvestorQ : Is it compulsory to have nominee for the demat account
Niraj Mehta made post

Is it compulsory to have nominee for the demat account

Arya Nanda answered.
3 years ago
Don’t ever forget to register a nominee for your DP account. This is more so in case of an individual account because, in case of joint accounts, the transmission to the joint holder is automatic. In fact, SEBI has now made it mandatory for appointing of a nominee when you open a demat account and even existing DP accounts are required to insert a nominee. A nominee is a beneficiary who automatically gets the right to the shares in the demat account in the event of your unfortunate demise. In case, you don’t want to appoint any nominee then you require to be giving a specific declaration that you don’t want to appoint any nominee. Only when the form is accepted. Check out the nomination form below.

You need to clearly mention if you don’t want to nominate anybody. You can create a nomination, cancel the nomination and also change the nomination. The choice is entirely yours. You can also appoint multiple nominees and you can also decide how much share each nominee gets. In the absence of any mention, the total demat account will be split in equal proportion among the nominees. There is an interesting aspect about the nomination in joint accounts. Firstly, each joint holder of the demat account has to sign the above nomination form in the same order as the account is held. Only then it is valid. Secondly, the nominee rights start only after the joint holders. So if A and B are joint holders, and if C is the nominee then what happens if A is dead. The account will automatically vest on B and only after the demise of B will the nomination to C take effect. This is important to understand.