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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Account Opening

A client opens a demat account and does not wish to give a nomination. What must the DP do?

The DP should record the client's explicit declaration opting out of nomination. Nomination is optional, so the DP cannot refuse the account, appoint a nominee itself, or freeze the account for that reason.

  1. ARefuse to open the account
  2. BAppoint a nominee on the client's behalf
  3. CRecord the client's explicit choice to opt out of nomination through a declaration, as the form requiresCorrect
  4. DFreeze the account after one year

Explanation

Nomination is optional but the client must either nominate or declare opting out, which is recorded. The DP cannot force or choose a nominee, and the account need not be refused or frozen merely for opting out.

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