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The Securities and Exchange Board of India (Sebi) has come out with a circular stating that the nomination rules pertaining to mutual fund units are postponed to October 1, 2022.

Last month, the regulator said that the mutual fund unit holders, from August 1, 2022, must furnish a separate declaration form if they do not want to file a nomination for their holdings.

The investors were given two choices when it comes to the nomination – a) providing nomination in the format specified by Sebi (or) b) opting out of nomination through a signed declaration form.

With the revised deadline in place, asset management companies (AMCs), on or after October 1, 2022, provide the above option to unitholders either in a physical or online form as per the choice of the unit holders.

For the physical option, the forms must carry the wet signature of the unitholders. In the case of the online option, the forms must have an e-Sign instead of a wet signature.

The new circular also talks about providing two-factor authentication (2FA) by the AMCs to validate the forms. One of the factors in the 2FA will be a one-time password sent to the unit holder at his/her email/phone number registered with the AMC.

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