New Delhi: The Lok Sabha on Tuesday passed the Banking Laws (Amendment) Bill, 2024, introducing key reforms to simplify bank deposit inheritance and improve governance. The Bill allows account holders to nominate up to four individuals for bank accounts, replacing the single-nominee rule.
Finance Minister Nirmala Sitharaman highlighted the consumer-friendly changes, aiming to resolve inheritance ambiguities and reduce unclaimed deposits.
Key Changes for Bank Accounts and Lockers
- Simultaneous Nominations: All nominees share equal rights, with no sequence for fund access.
- Successive Nominations: Nominees are ranked, with access granted in order.
For lockers, only successive nominations are allowed, ensuring clarity for heirs.
Governance and Regulatory Reforms
The Bill amends five banking laws, including the RBI Act, 1934, and Banking Regulation Act, 1949, to:
- Strengthen audits and compliance in public/cooperative banks.
- Extend directors’ tenure in cooperative banks from eight to ten years.
- Redefine “substantial interest” in shareholding to match modern values.
- Improve reporting deadlines.
It also allows unclaimed dividends, shares, and bond interests to transfer to the Investor Education and Protection Fund (IEPF), with refunds claimable by individuals.
Sitharaman praised India’s stable banking system and emphasized professionalism since 2014. The Bill, introduced on August 9, 2024, enhances consumer control over nominations and updates banking regulations.