Winning Bizness Desk
Mumbai.The Reserve Bank of India (RBI) has revised the claim settlement rules for deceased customers, directing all banks to process such claims within 15 days. If the settlement is delayed, nominees or legal heirs will be compensated. The new framework aims to bring uniformity to claim settlement procedures, replacing the different rules followed by banks earlier. The guidelines were released on 26 September and must be implemented by 31 March 2026.
Applicable institutions and scope
The rules apply to all commercial banks and cooperative banks across the country. They cover claims related to savings and deposit accounts, safe deposit lockers, and items kept under safe custody. However, the directive does not apply to government savings schemes operated through banks such as the Senior Citizens Savings Scheme (SCSS) and Public Provident Fund (PPF). In such cases, claims will continue to be settled as per the respective scheme’s terms and conditions.
Process for nominees and survivors
If an account has a registered nominee or survivor clause, banks will be responsible for releasing the balance amount directly to them. In the absence of such provisions, banks will follow a simplified process for smaller claims falling below the threshold limit. For cooperative banks, the threshold is set at Rs 5 lakh, while for other banks it is Rs 15 lakh. Banks may also choose to increase this limit. For claims above the threshold, additional documents such as a succession certificate or legal heir certificate may be required.
Rules for lockers and safe custody
For safe deposit lockers and safe custody items, banks are required to initiate the settlement within 15 days of receiving necessary documents. They must also coordinate with the claimant to fix a date for preparing an inventory of locker contents or items in custody. This is aimed at avoiding unnecessary delays and ensuring transparency in handling such claims.
Penalty for delays and customer benefit
If banks fail to settle claims related to accounts within the stipulated 15 days, they must explain the reason for delay and pay interest at the bank rate plus 4 percent annually for the delayed period. In the case of lockers or safe custody items, a penalty of Rs 5,000 per day of delay will be payable to the claimant. These provisions are expected to push banks to act promptly, ensuring quicker and easier settlements for customers’ families, while improving overall customer service standards.
Summary pointers:
1. RBI orders banks to settle deceased customers’ claims within 15 days.
2. New rules apply to all commercial and cooperative banks across India.
3. Claims cover accounts, lockers, and safe custody items.
4. Not applicable to government savings schemes like SCSS and PPF.
5. Threshold limits: Rs 5 lakh for cooperative banks, Rs 15 lakh for others.
6. Delay penalties include extra interest or Rs 5,000 daily compensation.
7. Aim is to simplify procedures and improve customer service.
