Online broking firm Zerodha's co-founder Nithin Kamath today said the company's new 'alert' feature, will help in solving the problem of unclaimed money. Kamath said around Rs 80,000 crores of unclaimed money is lying unclaimed across banks, mutual funds, demats and more.
"There's at least Rs 80,000 crores of unclaimed money across Banks, Mutual funds, Demats, & more. We are hoping this alert feature which notifies nominees when accounts become dormant & they don't reKYC, can help in solving this problem," he tweeted, adding that hopefully, the banks and others will follow.
He reacted to a tweet by the company that said most people miss adding nominees to their demat accounts, partly because adding a nominee was an offline process. This leads to issues in the case of unforeseen events, it added.
"Not anymore. You can now add up to 3 nominees online. We'll also alert your nominees if your account is dormant," it said.
As per the company, this nomination covers users' all kinds of investments at Zerodha, including stocks, mutual funds and bonds. Zerodha says users can add single or multiple nominees to their trading and demat account, completely online.
"We will alert your nominee(s) over email/SMS if your account becomes dormant after one whole year of inactivity and you do not activate it by performing reKYC in time in response to the notifications we send you," says the company.
The company said nominee(s) are also informed of the existence of the person's trading and demat account and the nomination in case of any unfortunate eventualities.
While the demat account opening became digital in 2016, adding nominees has been a physical process until now. This is because the process of nomination that the government defined mandated the collection of a physical form and multiple witness signatures. The regulation around this changed very recently, with market regulator SEBI allowing an option to add up to 3 nominees to your trading and demat account completely online using eSign.
Why do the nominees have to be alerted?
How to add a nominee
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