Nominee Limit Raised? Find Out How It Affects Your Savings in the Latest Banking Rule Revolution!
New Delhi (The Uttam Hindu): Finance Minister Nirmala Sitharaman introduced the Banking Laws (Amendment) Bill 2024 in Parliament on Tuesday, which has now been approved. This proposal, aimed at enhancing banking services, allows customers to add up to four nominees to their bank accounts. The change comes as a welcome move for account holders, simplifying the rules surrounding account nomination.
Key Highlights from Finance Minister Nirmala Sitharaman
While presenting the bill, Sitharaman explained that under the current rules, depositors could nominate only one individual for their bank account deposits or locker contents. However, with this amendment, depositors now have the flexibility to add up to four nominees, either consecutively or simultaneously.
The Finance Minister also mentioned that the Banking Laws (Amendment) Bill, 2024, proposes 19 changes to five existing laws. These amendments aim to simplify compliance, enhance regulation, and improve banking services, including those provided by multi-state cooperative societies. The bill also outlines reforms in bank auditing.
Changes for Locker Holders
For customers utilizing locker services, the rules differ slightly. They will only have the option of sequential nominations, meaning nominees can only be added one after the other. Sitharaman clarified that sequential nomination ensures continuity, as the next nominee automatically becomes effective if the first is unavailable. This will reduce legal complexities for the rightful heirs of the contents stored in lockers.
Government and RBI’s Vigilance
Sitharaman emphasized that both the government and the Reserve Bank of India (RBI) have been vigilant about maintaining the stability of banks since 2014. The objective has been to ensure the safety, stability, and health of banks. She highlighted that, over the past decade, Indian banks have transitioned to professional management, marking a significant national achievement.
Government’s Stance on Bank Mergers
In a written response to a question in the Rajya Sabha on Tuesday, Minister of State for Finance Pankaj Chaudhary stated that the government currently has no plans for further mergers of public sector banks. This clarification comes after the government merged 10 public sector banks into four entities in 2019.
The amendments in the Banking Laws (Amendment) Bill, 2024, reflect the government’s commitment to improving the banking system while prioritizing the convenience and security of customers.
