Markets regulator SEBI on Tuesday proposed leveraging DigiLocker, a government-backed digital document storage platform, to streamline processes and minimize unclaimed assets in the securities market.
In its consultation paper, the regulator has proposed that depositories and mutual funds should provide demat and mutual fund holding statements on DigiLocker.
Further, it has been suggested that KYC Registration Agencies should share information on an investor's demise with DigiLocker.
DigiLocker users can nominate individuals for their accounts.
This proposal aims to reduce unclaimed and unidentified assets, ensuring smoother transmission of financial holdings to rightful heirs while safeguarding investor interests.
In case of a user's death, DigiLocker will update the account status based on death registration data from the Registrar General of India, or information from the KRA system, the regulator proposed.
DigiLocker will automatically notify the nominee through SMS and email.
The nominee can then access the deceased's digital records and initiate the process of asset transmission by contacting the concerned AMC or Depository Participant.
The Securities and Exchange Board of India has sought public comments till Dec. 31 on the proposals.
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