The RBI plans to standardise forms to process claims on deceased customers' bank accounts and lockers within a 15-day timeframe and provide compensation to nominees for any settlement delays.
The Reserve Bank of India (RBI) proposes to come out with standard procedures for the settlement of claims in respect of bank accounts, and articles kept in safe custody or safe deposit lockers of deceased bank customers. The aim is to make the settlement more convenient and simpler.
Towards this, the central bank has issued 'Draft Circular - Reserve Bank of India (Settlement of Claims in respect of Deceased Customers of Banks) Directions, 2025' and invited comments and feedback on it by August 27.
"A bank shall use the standardised forms for receiving the claims and other documents...," said the draft.
It also has provisions for compensation for delay in the settlement of claims.
In case a nominee has been provided in deposit accounts or lockers, he or she would have to submit a claim form, death certificate (deceased customer), and an officially valid document of the nominee/survivor towards verifying identity and address, the draft said.
According to the draft, a bank should adopt a simplified procedure for settlement of claims in deposit accounts, where a deceased depositor had not made any nomination, keeping in view the imperative need to avoid inconvenience and undue hardship to the claimant/ legal heir.
For the settlement of such claims, a bank, based on its risk management systems, should fix a threshold limit, subject to a minimum of Rs 15 lakh.
In cases of claim amount up to the threshold limit, additional documents like a bond of indemnity/ surety signed by the claimants and a letter of disclaimer/ no objection from non-claimant legal heirs, if applicable, will be required.
For a claim amount above the threshold limit, a succession certificate, or a legal heir certificate issued by a competent authority, or a declaration regarding the legal heirs of the deceased depositor would also be needed.
The draft also lists documents required for settlement of claims in a safe deposit locker and articles in safe custody kept by the deceased customer in cases without a nominee/survivor.
It further said that a bank should settle a claim in respect of deposit accounts of a deceased customer within a period not exceeding 15 calendar days from the date of receipt of all the requisite documents associated with the claim, it said.
"In case of safe deposit locker/ articles in safe custody, the bank shall, within 15 days of receipt of all the requisite documents, process the claim and issue communication to the claimant for fixing the date for taking inventory of the locker/ articles in safe custody," said the draft.
According to the draft, the standardised forms and other documents required for settlement of claims with respect to the deposit accounts/ safe deposit locker/ articles in safe custody kept by a deceased customer should be made available in all the branches as well as on the bank's website.
Banks should also display on their website the list of documents to be submitted by a claimant and the procedure to be followed for the settlement of claims in various scenarios.
On compensation for delay in settlement of claims, the draft said that if any deposit-related claim is not settled within the timeframe stipulated, then the bank should communicate to the claimants the reasons for such delay.
"Further, in cases of delay attributable to the bank, compensation shall be paid to the claimants by the bank in the form of interest, at a rate not less than the prevailing Bank Rate plus 4 per cent per annum, on the settlement amount due for the period of delay. The reference date for reckoning the amount due and the prevailing Bank rate shall be the date of receipt of all requisite documents from the claimant," the draft said.
In claims related to safe deposit locker/ articles in safe custody, the bank would pay compensation to the claimants at the rate of Rs 5,000 for each day of delay, in cases where it doesn't adhere to the timeline prescribed.
While issuing the draft directions, the RBI said the nomination facility in deposit accounts, safe deposit lockers and articles in safe custody is intended to facilitate expeditious settlement of claims by banks upon the death of a deceased customer and to minimise hardship caused to the family members.
Further, in cases where nomination is not registered, the extant instructions require banks to adopt a simplified procedure up to a threshold limit.
"However, it is observed that divergent practices are being followed by banks. Hence, it has been decided to review the extant instructions and issue revised regulations to streamline the procedures and standardise the documentation to bring improvement in the quality of customer service in this regard," it said.
The RBI proposes to implement the revised regulations as expeditiously as possible, but no later than January 1, 2026.
