Key excerpts from a recent circular issued by the Reserve Bank of India.
It has been brought to our notice that some banks do not have the system of acknowledging the receipt of the duly completed form of nomination, cancellation and/or variation of the nomination. Further, it is also understood that in some banks, although there is a system of acknowledgment of nomination as provided in the Savings Bank account opening form, such acknowledgments are actually not given to the customers.
1. In this connection, banks are aware that in terms of Rules 2 (9), 3 (8) and 4 (9) of the Banking Companies Nomination (Rules), 1985, they are required to acknowledge in writing to the depositor(s)/locker hirer(s) the filing of the relevant duly completed form of nomination, cancellation and/or variation of the nomination.
2. Banks are therefore advised to strictly comply with the provisions of Banking Regulation Act, 1949 and Banking Companies (Nomination) Rules, 1985 and devise a proper system of acknowledging the receipt of the duly completed form of nomination, cancellation and/or variation of the nomination. Such acknowledgment should be given to all the customers irrespective of whether the same is demanded by the customers.
3. A suggestion has been received that banks should indicate the name of the nominee in Pass Books/Fixed Deposit Receipts (FDRs). Since this would be helpful to the customers/nominees, banks are advised that in addition to the legend â€œNomination Registeredâ€, they should also indicate the name of the nominee in the Pass Books/Statement of Accounts/FDRs, in case the customer is agreeable to the same.
Call for action:
- If you haven’t already availed of the nomination facility for your accounts and other deposits, today is probably the best time to get started on this task.
- If you have already availed the nomination facility, check whether your accounts and deposits have recorded the details. If not, get it done immediately.
Awareness Fridays is my initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.