SEBI's Regulation for Share Transfer After Investor’s Death

Hassles of Investor Death Confirmation

In the past, confirmation of investors' demise and the following actions were lengthy, which has been a hassle for investors.

Who can Report the Investor Death?

1. Joint Account Holder(s). 2. Nominee(s). 3. Legal Representative. 4. Family Members.

What Happens after the Death is Reported?

After the death is reported with the deceased investor's PAN and death certificate, the intermediary has to verify the latter by the next working day.

Who is an  Intermediary?

The intermediary here is any organisation involved with the securities market that first received information about the deceased individual.

How is Death Certificate Verified?

1. Online: Via the website of the issuing Government authority.  2. Offline: OSV (‘Original Seen and Verified’) process by intermediary.

Post-Verification Process

All debit transactions in the account will be blocked.  The deceased’s KYC will be "Blocked Permanently."

Post-Verification  Process

The family member/nominee will be informed about the share transfer procedure within 5 days of the death

Update Records in the KRA System

1. On the death certificate verification day, the intermediary must submit a ‘KYC modification request’ to the KRA that the certificate is verified with documents. 

Update Records in the KRA System

2. Block all debit transactions in the account of the deceased investor.

Update Records in the KRA System

3. If the death certificate isn’t received, the intermediary must (by the next working day) submit a ‘KYC modification request’ about the confirmation being awaited.

What if the Certificate cannot be verified?

1. If the death certificate cannot be accessed, the family members/nominee will be informed that the KYC has been put “On Hold”.

What if the Certificate cannot be verified?

2. The family members/nominees will be asked to provide the death certificate, after which the verification process will be followed.

When will this be Implemented?

This new regulation will be implemented from 1st Jan 2024.