Harnessing DigiLocker as a Digital Public Infrastructure for reducing Unclaimed Assets in the Indian Securities Market
Summary
SEBI directs securities market intermediaries to integrate with DigiLocker to enable investors to access holding and transaction statements digitally. The circular establishes a mechanism for KRAs to share investor demise data with DigiLocker to notify nominees and prevent unidentified unclaimed assets. Implementation is mandated from April 1, 2025, requiring intermediaries to register as issuers and update bye-laws accordingly. This section details DigiLocker's functionalities as a secure document gateway and its integration with the Civil Registration System to update user status upon demise. It outlines the centralized mechanism where Key Registration Agencies (KRAs) report investor deaths to intermediaries, triggering account freezes and transmission procedures. Finally, it provides illustrative scenarios for how DigiLocker nominees interact with existing folio or demat account nominees during asset transmission.
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In line with its core mandate of investor protection and safeguarding investor interests, SEBI has directed its efforts towards minimizing the creation of Unclaimed Assets (UA) in the securities market.
DigiLocker is digital document wallet of the Government of India (GoI), facilitating citizens in obtaining and storing documents like Aadhaar, PAN, Driving Licence, Death Certificate, etc.
DigiLocker also provides nomination facility to its users. The nominee/s specified by the user is/are authorised to access the digital information of the user upon the demise of the user.
DigiLocker system will update the status of demise of its user, from either of the following sources; Register of deaths of the Registrar General and Census Commissioner (RGI), or verified information on demise and also the death certificate of the investor available with KRA system.
At SEBI’s instance, a mechanism has been created whereby the DigiLocker automatically notifies the DigiLocker Nominee/s about demise of the user through SMS and e-mail.
Accordingly, all AMCs (and their RTAs) and recognised Depositories are directed to register with DigiLocker as ‘Issuer’ so as to enable users / investors, at their own option, to fetch their holding statement... or transaction statements for the last 30 days.
the latest generated or last available Consolidated Account Statement (CAS) in the previous 12 months of the request.
Additionally, DigiLocker system shall also provide the user the option to fetch CAS automatically on the 1st of January each year.
KRAs are directed to electronically share the details of all the instances of demise of investors available in their system with DigiLocker with adequate safeguards for data safety.
Investors may consider becoming users of DigiLocker and also consider specifying nominee/s for the DigiLocker (over and above the nomination/s, if any, made in their demat account and MF folio).
The DigiLocker Nominee herself can initiate the transmission of deceased investor’s financial assets, if she is also the nominee in the account / folio of the investor. Otherwise, it is envisaged that the DigiLocker Nominee/s will pass on the information... to the surviving joint holder or nominee... or the legal heir.
Investors holding securities in physical mode, can also avail the beneficial measures envisaged in this circular by opting to de-materialize their holdings.
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Source: SecMarx — Harnessing DigiLocker as a Digital Public Infrastructure for reducing Unclaimed Assets in the Indian Securities Market. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.