What is a Nomination?
An investor can nominate a person(s) called nominee(s) to whom his/her Mutual Fund Units will be transferred on his / her demise. The investment proceeds will get transferred to the nominee registered on the demise of the Investor.
What are the benefits of registering a nomination?
If a nomination has been made by the investor, the institution (bank, MF, insurance company, post office etc) would simply hand over the investment proceeds to the nominee on receipt of the death certificate of the investor and identity proof of the nominee claiming the proceeds. But in the absence of nomination, accessing the investment amount becomes extremely complicated and delayed by the legal procedures. The heirs may need to get appropriate directions from court to release the investment.
Can an investor make multiple nominations?
Yes! An investor may make up to three nominations and even specify the percentage of the amounts that will go to each nominee.
If the percentage is not specified, equal shares will go to the nominees.
Whom can I nominate?
You can nominate any individual as your nominee. However, you cannot nominate the following as your nominee with regard to your mutual fund units:
1. A Trust
2. A Society
3. A Body Corporate
4. A Partnership Firm
5. Karta of a Hindu Undivided Family
6. A Power of Attorney Holder
Can a minor be a nominee?
Yes! A minor can be a nominee. However the guardian will have to be specified in the nomination form.
Can a nomination be changed?
A nomination can be changed and even cancelled. The relevant form should be filled and submitted to the Registrar or Mutual Fund Office.
Can a nomination be cancelled?
Yes! The cancellation of nomination can be made only by the owner himself (who made the original nomination). On cancellation of the nomination, the nomination shall stand rescinded.