There are two possibilities in a bank account maintained by a customer viz. (i) a deposit account is opened in a bank with a valid nomination or with the survivorship clause like ‘either or survivor’, or ‘anyone or survivor’, or ‘former or survivor’ or ‘latter or survivor’ etc. (ii) A deposit account is opened in…
HUF is the acronym for Hindu Undivided Family. A HUF can be formed by members of a family, wherein the members are lineal ascendants or descendants of Hindus, Buddhists, Jains, and Sikh religions. The eldest member becomes the Karta of HUF. Other members of the family are called coparceners. The coparceners share equally with the…
Karta (Manager) of HUF has sole authority over the HUF account and also over every transaction on behalf of the HUF account, made by each member of the family. Therefore, it is necessary to appoint a new Karta to allow operation in the account after the death of the Karta to allow further operation in…
Let us first understand the meaning of a Dormant Account and an Inoperative account. Dormant Account A Savings Bank account or Current account becomes a ‘Dormant Account’ if it is not operated during the previous 12 months. Inoperative Account An SB or Current account becomes a ‘Dormant Account’ if the account has not operated during…
A Savings Bank account (SB Account) is a form of demand deposit account, opened mainly for the purpose of saving and not for any business purpose. Banks are permitted to credit the interest to the account on a regular basis, with regard to the savings bank accounts frozen by the enforcement authorities. The acceptance of…
Regulatory compliance aims to ensure the bank operates within regulation, safeguarding its integrity and industry reputation. The function oversees multiple duties: protecting bank data, avoiding government fines, avoiding tax evasion, complying with KYC guidelines, monitoring and reporting anti-money laundering activities, assessing risks, and ensuring zero violation of banking ethics. Following are the few cases where…
The account held by the resident Indian will be re-designated as an NRO account, once he/she becomes a Non-Resident Indian (NRI). A new NRO account can be opened in the bank from abroad if they need one. NRO account is maintained in Indian Currency. The NRO account holder can use these funds available in his…
Joint accounts are accounts that are in the name of two or more persons. The operation instructions in joint accounts in banks like ‘either or survivor’, former/latter or survivor’, ‘anyone or survivor’, ‘both or survivor’, or ‘all or survivor’ are actually a mandate given by the joint holders of the account. Every above operation instructions…
A savings /fixed / recurring bank deposit account can be opened by a minor of any age through his/her natural or legally appointed guardian. Banks in India have the freedom to fix the minimum age at which they will allow a minor to operate his account in a single name. As a result, a minor…
Dealing with accounts of mentally ill or lunatic or insolvent persons remains a delicate job for bankers. Whenever bankers learn that one of their customers is incapable of operating the account due to mental incapacity the operation of such a customer’s account shall be immediately suspended. While dealing with such accounts, bankers need be to…