SEBI Extends Timeline for Implementation of Revised Nomination Framework for Mutual Funds and Demat Accounts [Read Circular]

The circular is addressed to mutual fund asset management companies (AMCs), registrars and transfer agents (RTAs), recognized depositories, and registered depository participants. It extends the deadlines for Phase II and Phase III of SEBI’s nomination reform plan, which was originally laid out in earlier circulars dated January 10, 2025, and February 28, 2025.

SEBI received requests from key market infrastructure institutions, including CDSL and NSDL, as well as industry bodies such as ANMI and CPAI. They cited technical and operational difficulties in implementing the required system changes under the updated nomination framework.

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In response, SEBI has revised the schedule as follows:

• Phase II, which was originally set to begin on June 1, 2025, will now start on August 8, 2025.
• Phase III, which was scheduled to begin on September 1, 2025, has been pushed to December 15, 2025.

Background

SEBI introduced the revised nomination framework to streamline and standardize the process of adding nominees for mutual fund and demat account holders. The goal is to ensure smooth transmission of assets and reduce investor grievances in case of the account holder’s death.

The changes were meant to be rolled out in phases to help intermediaries prepare, but after feedback from the industry, SEBI decided to give additional time for the development and testing of new systems.

Other Rules Still Apply

SEBI clarified that all other provisions from the earlier circulars remain unchanged. Only the implementation dates for Phases II and III have been postponed.

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