How to Add a Nominee to Your Mutual Fund Investments

Adding a nominee to your mutual fund investments is one of the most important yet overlooked steps in financial planning. A nominee ensures that your mutual fund investments are smoothly transferred to your loved ones in case of an unfortunate event. This guide explains how to add a nominee to your mutual fund investments, both online and offline.

What Is a Nominee in Mutual Funds?

A nominee is the person who is authorized to receive your mutual fund investments in the event of your death. The nominee acts as a custodian of the assets and can either claim the investments or transfer them to the legal heirs as per the will or succession laws.

Important: A nominee is not the same as a legal heir. A nominee is simply the person authorized to receive the assets from the fund house. The actual ownership is determined by the investor’s will or applicable succession laws.

Why Is Adding a Nominee Important?

• Hassle-free claim process: Without a nominee, your family will need to go through a lengthy legal process (including obtaining a succession certificate or probate) to claim the mutual fund investments.
• Quick settlement: With a nominee on record, the fund house can process the claim much faster.
• SEBI mandate: SEBI has made it mandatory for mutual fund investors to either nominate someone or explicitly opt out of nomination. Failing to do so can freeze your folio for new transactions.
• Peace of mind: Knowing your investments will reach your family without bureaucratic hurdles is invaluable.

How to Add a Nominee Online

Through Your Investment App (like Bachatt)

1. Open the app and go to your profile or account settings
2. Look for the “Nomination” or “Nominee” section
3. Click on “Add Nominee”
4. Enter the nominee’s details: full name, relationship, date of birth, and address
5. If adding multiple nominees, specify the percentage share for each (total must equal 100%)
6. Verify with OTP or e-sign
7. The nomination is updated across all your folios on the platform

Through the AMC Website

1. Log in to the AMC website where you have investments
2. Navigate to the “Service Requests” or “Nomination” section
3. Select the folio for which you want to add a nominee
4. Fill in the nominee details
5. Authenticate with OTP and submit

Note: You may need to repeat this for each AMC if you have investments across multiple fund houses.

Through MF Central

1. Log in to mfcentral.com
2. Go to “Service Requests” and select “Nomination”
3. Select folios and add nominee details
4. Authenticate and submit

How to Add a Nominee Offline

If you prefer the physical route:

1. Download the Nomination Form from the AMC’s website or collect it from a CAMS/KFintech service centre
2. Fill in your folio number and nominee details
3. Sign the form (all holders must sign for joint holdings)
4. Submit at the AMC office or nearest CAMS/KFintech service centre
5. Carry an ID proof for verification

Key Rules About Mutual Fund Nomination

• Maximum 3 nominees: You can nominate up to 3 people for a single folio
• Percentage allocation: When adding multiple nominees, you must specify the percentage share for each. The total must equal 100%.
• Minor nominee: You can nominate a minor, but you must also appoint a guardian who will manage the investments until the minor turns 18.
• Joint holdings: In case of joint holdings, the nomination is effective only after the death of all holders.
• Changing nominees: You can change or update your nominee at any time. The latest nomination supersedes all previous ones.
• Opt-out: If you do not wish to nominate anyone, you must submit a written declaration opting out of nomination.

What Happens When a Nominee Makes a Claim?

When the investor passes away, the nominee needs to:

1. Submit a claim form to the mutual fund house
2. Provide the original or attested copy of the death certificate
3. Submit KYC documents of the nominee
4. Provide bank details of the nominee for the payout

The fund house typically processes the claim within 30 days of receiving all necessary documents. The nominee can choose to either redeem the units (get cash) or transfer the units to their own folio.

SEBI’s Recent Push on Nomination

SEBI has been actively pushing for mandatory nomination. Recent regulations require that:

• All existing folios must have a nominee or an opt-out declaration
• New folios cannot be opened without specifying nomination preference
• Non-compliant folios may face restrictions on new transactions

If you have old folios without nominees, update them as soon as possible to avoid any disruptions.

Secure Your Family’s Future with Bachatt

Bachatt makes adding a nominee quick and seamless. Update your nomination details in the app in just a few taps, and ensure your mutual fund investments are protected for your loved ones. We also send reminders if your nomination details are incomplete or missing.

Download the Bachatt app and add a nominee to your mutual fund investments today. It takes less than 2 minutes but makes a world of difference for your family.