Top News

Following a directive from SEBI aimed at simplifying the claims process for nominees and legal heirs, the Association of Mutual Funds in India (AMFI) has streamlined the procedure for transferring mutual fund units after an investor's death. AMFI has announced changes to the processes for claiming units and proceeds following an investor's demise, with the objective of making the transfer process easier. These changes are designed to eliminate operational hurdles and ensure that the deceased investor's heirs can seamlessly claim the units.

What changes following AMFI's announcement?
Under the revised rules, if the address on record does not match, Asset Management Companies (AMCs) can rely on the latest available address of the deceased unit holder, provided it is supported by relevant documentation. AMFI has introduced a harmonized framework to address minor and major discrepancies in the deceased investor's name or signature. This aligns the process with the provisions applicable to Registrars and Transfer Agents (RTAs) as outlined in SEBI's February 2026 circular.

These changes address the operational difficulties and anxiety families face when claiming mutual fund investments due to minor documentation discrepancies. AMFI stated that it would conduct training programs for AMCs to ensure the uniform implementation of these procedures.

Changes regarding address discrepancies?
In accordance with SEBI's directive, AMCs can rely on the latest available address of the deceased unit holder—provided it is backed by relevant documents—in cases where the address in the mutual fund records differs from the one submitted by the claimant. SEBI has also introduced a harmonized framework to resolve discrepancies regarding names and signatures. In this regard, AMCs can now adopt procedures similar to those prescribed for issue registrars and share transfer agents (RTAs). Under these guidelines, claimants may submit self-attested identity documents—such as an Aadhaar card or passport—in cases of name discrepancies. Regarding signature mismatches, AMCs may adopt appropriate procedures based on the nature of the discrepancy, aligning with the framework used by RTAs.

What do the new changes entail regarding legal heirs?
According to AMFI, the transfer of units is a process whereby units held by a deceased unitholder are transferred either to a nominee or to the deceased unitholder's legal heirs. Although this process is well-established, claimants often face delays due to issues such as address discrepancies, variations in name spellings, or signature mismatches between records and identity documents. By allowing greater flexibility in verifying such discrepancies through valid supporting documents and by harmonizing verification procedures, SEBI aims to make the claim process faster and less stressful for families or nominees.

Disclaimer: This content has been sourced and edited from Amar Ujala. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.