Why this matters
Nomination exists to solve a practical problem for banks, depositories and insurers: after a death, someone has to be able to receive the money without the institution having to work out who the lawful heirs are. Naming a nominee gives the institution a valid discharge when it pays out.
Entitlement is a separate question, and it is answered by succession law. If there is a will, the asset belongs to the beneficiary named in it. If there is no will, it passes under the intestate rules that apply to the deceased. A nominee who is not that person is, in effect, holding the money for whoever is entitled.
What NRIs should consider
Name the same person in both places where you can
If your nominee and your beneficiary are the same person, the practical route and the legal entitlement line up and disputes are far less likely.
Cover accounts in the will anyway
List NRE, NRO and FCNR accounts, fixed deposits, demat holdings and mutual fund folios in the will with their identifiers, even where nominations already exist.
Nominations go stale
Nominations made years ago often name a parent or a former joint holder. Review them alongside the will, especially after a marriage, divorce or bereavement.
Different products, different rules
Company shares, insurance policies and co-operative society interests have their own nomination provisions and have been treated differently by courts. Take India-qualified advice where a large asset turns on this point.
Repatriation is a separate question
How funds can be moved out of India after inheritance depends on exchange-control rules and the bank's own process, not on the nomination.
Example
An NRI in Dubai names their brother as nominee on an NRO account, but wants their spouse to inherit it.
On death, the bank may release the balance to the brother as nominee. That does not make the money his: entitlement follows the will or, absent one, succession law.
Naming the spouse as the beneficiary of that account in an India-specific will makes the intention explicit — and updating the nomination to match removes the friction entirely.
This example describes general considerations only. It is not advice about any particular person’s situation.
When professional legal advice may be appropriate
Consider speaking with a lawyer qualified in India if your estate spans several countries in a complicated way, if significant tax planning is involved, if a family dispute or contested estate is likely, if a business, trust or unusual ownership structure is part of the estate, or if you are unsure how a Will made where you live interacts with one covering Indian assets.