RBI’s Strict Rule: Banks will have to settle claims of dead customers within 15 days, otherwise they will have to pay a fine

While releasing the monetary policy, Reserve Bank of India Governor Sanjay Malhotra had said that the central bank will streamline and standardise the process for settlement of claims of bank accounts and lockers of the deceased.

RBI’s Strict Rule:The Reserve Bank of India (RBI) has taken a special initiative to settle claims related to bank accounts and lockers of deceased customers within 15 days. The central bank plans to standardize the form to settle such cases within the stipulated time frame and compensate the nominees for any delay. RBI has proposed to bring standard procedures for settlement of claims related to items kept in bank accounts and safe deposit lockers of deceased bank customers. Its aim is to make the settlement more convenient and simple.

Comments sought by August 27

In this direction, the central bank has issued a draft circular – ‘Reserve Bank of India (Settlement of Claims in Respect of Deceased Customers of Banks) Directions, 2025’ and has sought comments on it by August 27. The draft said, “The bank will use standardized forms to receive claims and other documents.” It also provides for compensation in case of delay in settlement of claims. The draft states that if a person is nominated for a deposit account or locker, he or she will have to submit a claim form, death certificate (of the deceased customer) and an officially valid document of the nominee (nominee) for verification of identity and address.

Emphasis on adopting a simplified process

As per the draft, the bank should adopt a simplified process for settlement of claims in deposit accounts where the deceased depositor has not made any nomination, so as to avoid inconvenience to the claimant or legal heir. The bank should fix a minimum limit of Rs 15 lakh for settlement of such claims based on its risk management systems. Currently, all banks have their own systems and processes in respect of claims relating to the account and locker by the ‘nominee’ person of the deceased. Similarly, there may be some variation in the processes of banks for accounts without a ‘nominee’. This move will standardize and simplify the process. As per the existing instructions, banks are required to adopt a simplified process to facilitate prompt and hassle-free settlement of claims made by ‘nominee’ persons/legal heirs.

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