Advertisement
The Reserve Bank of India recently released a draft circular proposing stricter timelines and penalties for banks that delay settling claims related to the accounts, lockers, or safe custody articles of deceased customers. The central bank suggested that banks must release funds to nominees without demanding succession certificates or court orders, provided there's no dispute and only basic documents are submitted. Delays would attract penalties interest at bank rate plus 4% for deposits, and INR 5,000 per day for lockers. Even non-nominee claims can be processed internally up to INR 15 lakh. Feedback on the draft is being invited before final guidelines are issued.
The Reserve Bank of India proposed new rules aimed at ensuring faster claim settlements for nominees and legal heirs of deceased bank customers. The draft circular lays out clear timelines and penalties that banks must follow while handling claims related to bank deposits, lockers, and safe custody articles. Advertisement
According to the proposal, banks would no longer be allowed to demand succession certificates or court orders from nominees in the absence of disputes or a will. Instead, claims should be settled based on simple documentation, such as a claim form, death certificate, and identity proof.
If banks delay settlement, they will be required to compensate customers. For overdue fixed deposit claims, banks must pay interest at the prevailing bank rate plus 4% per annum from the date of maturity until payment is made. In the case of locker or safe custody claims, delays beyond the prescribed timeline will attract a penalty of INR 5,000 per day.
The draft also covers cases where the deceased did not nominate anyone or held joint accounts. In such cases, banks can still process claims up to INR 15 lakh through an internal mechanism after completing due diligence and collecting required documents. The settlement for all eligible claims must be completed within 15 days from the date of submission of all necessary paperwork.
These proposed rules are aimed at reducing the distress faced by families during a difficult time. The central bank has opened the draft for public comments and suggestions, which can be submitted until later this month. Final guidelines will be issued after reviewing the feedback received.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
