How does nomination work in mutual funds?
Key facts
- A nominee receives your units on your death and passes them to your legal heirs; nomination eases transmission.
- From 1 September 2026, single-holder folios must nominate or formally opt out; blank is not allowed.
- For jointly held folios, nomination is optional.
- Only the nominee's name and relationship are mandatory; a minor nominee also needs a date of birth.
Why nomination matters
A nomination names the person the fund house will hand your units to if you die. It does not decide who ultimately owns them, that is your will or succession law, but it makes the transmission process far smoother for the people you leave behind. Without it, families can face a longer, document-heavy claim.
The rule is changing
From 1 September 2026, a single-holder folio must either carry a nomination or a formal opt-out declaration. Leaving the field blank is no longer allowed. For jointly held folios, nomination remains optional. The information needed is deliberately light: the nominee's name and relationship, plus a date of birth if the nominee is a minor.
Please verify: confirm the maximum number of nominees permitted and the exact treatment of existing (pre-1 September 2026) folios against the current SEBI circular before relying on the detail.
How to add one
You can add or update a nominee through the fund house, the registrar, or your distributor, usually online. Choose the person, record their name and relationship, add guardian and date-of-birth details for a minor, and confirm the nomination shows on your folio.
Nomination sits alongside a will, it does not replace one. If you would like help getting your folios in order, talk to us.
How to add or update a mutual fund nominee
- Decide your nominee. Choose who should receive your units, and note their name and relationship to you.
- Submit the request. Add or update the nominee through the fund house, the registrar (CAMS or KFintech), or your distributor, online or on the prescribed form.
- Provide minor details if needed. If your nominee is a minor, provide their date of birth and a guardian's details.
- Confirm it is recorded. Check your account statement or folio details to confirm the nomination is registered.
Frequently asked questions
Is nomination mandatory for mutual funds?
From 1 September 2026, single-holder folios must either register a nominee or submit a formal opt-out declaration; you cannot leave the field blank. For jointly held folios, nomination is optional. Existing investors are encouraged to add one.
Does the nominee become the owner of my investments?
Not automatically. A nominee is the person the fund house hands the units to on your death, which speeds up transmission. Final ownership is governed by your will or the applicable succession law, so nomination and estate planning work together.
Can I have more than one nominee?
Yes, you can appoint multiple nominees and set the share for each. Only the name and relationship are mandatory, and a minor nominee needs a date of birth and a guardian.
This is general information, not a recommendation for your situation. If it would help to talk it through, we are happy to. Talk to Nico Wealth.
The information on this website is general and educational. It is not financial, tax, or legal advice, and not a recommendation for your situation. We try to keep it accurate and up to date, but it may contain errors or become outdated. Please verify important details from official sources, and consider your own circumstances, before acting.
Sources
- SEBI circular on nomination for mutual fund folios and demat accounts (mandatory from 1 September 2026)
- AMFI (investor resources)
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