Description

BSE introduces new API for nomination opt-out reporting in mutual funds, mandating OTP-based authentication or video recording for individual investors opting out of nomination facilities.

Summary

BSE has introduced a new Nomination Opt-Out API for the mutual funds segment on the BSE StAR MF platform. As per SEBI guidelines, both nominee opt-in and opt-out details must be reported to RTAs/AMCs. The API enables investors to opt out of nomination through OTP-based authentication or video recording, applicable across manual, bulk upload, and API channels.

Key Points

  • New JSON-based API for reporting nomination opt-out details to RTAs/AMCs
  • Mandatory OTP-based authentication or video recording for opting out of nomination
  • Applies to all Individual tax status and new folios
  • Available for manual, bulk upload, and API modes
  • Existing client codes with nomination opt-out status ‘N’ can use this API to provide required authentication details
  • API endpoint: https://bsestarmfdemo.bseindia.com/BSEMFWEBAPI/api/NomineeRegistration/V1

Regulatory Changes

SEBI guidelines now require both nominee opt-in and nominee opt-out details to be reported to RTAs/AMCs. Opting out of nomination via OTP-based authentication or video recording is mandatory for all individual tax status investors and new folios.

Compliance Requirements

For BSE StAR MF Platform Members:

  • Implement the Nomination Opt-Out API in their systems
  • Ensure nomination opt-out value is set to ‘N’ when applicable
  • Capture nomination authentication mode: ‘O’ for OTP with declaration or ‘V’ for Video Recording
  • Provide alphanumeric nomination opt-out reference number (up to 20 characters)
  • Update existing client codes where nomination opt-out is ‘N’ with required authentication details

API Request Parameters (Mandatory):

  • UserId (20 characters)
  • MemberCode (20 characters)
  • Password
  • ClientCode (10 characters)
  • NominationOpt (must be ‘N’)
  • NominationAuthMode (‘O’ or ‘V’)
  • NomOptRefNo (alphanumeric, 20 characters)

API Response Codes:

  • StatusCode 100: Success
  • StatusCode 101: Failure

Important Dates

Effective Date: November 2025 (document dated NOV 2025)

Impact Assessment

Operational Impact:

  • Mutual fund distributors and platforms using BSE StAR MF must integrate the new API
  • Additional authentication step required for investors opting out of nomination
  • Enhanced compliance tracking for RTAs and AMCs

Investor Impact:

  • Individual investors opting out of nomination must complete OTP authentication or video recording
  • Improved investor protection through stronger authentication mechanisms
  • Existing folios with opt-out status need to be updated with authentication details

Technology Impact:

  • System integration required for API implementation
  • JSON-based format for seamless data exchange
  • Demo environment available for testing at bsestarmfdemo.bseindia.com

Impact Justification

Affects mutual fund distributors and investors using BSE StAR MF platform. Introduces new API requirements for nomination opt-out compliance with SEBI guidelines, but is operational enhancement rather than urgent regulatory change.