Bank Account for Kids: If you have a child aged 10 years or more, here’s good news!
The Reserve Bank of India (RBI) has announced a new rule allowing children aged 10 or above to open and manage their own savings or fixed deposit accounts.
This rule aims to help children learn the value of money and develop financial responsibility from a young age. It will come into effect from July 1, 2025.
Accounts Can Be Opened for Kids of Any Age
Parents can open bank accounts for their children at any age.
However, until the child turns 10, the account must be managed by a guardian, usually a mother or legal guardian, as per RBI guidelines.
Children Can Manage Accounts from Age 10
Once a child turns 10 years old, they can independently manage their bank account.
However, each bank can set its own conditions based on its internal policy and security measures—such as limits on withdrawal or available services.
Banks are required to clearly explain these terms to the child.
Account Will Be Updated at Age 18
When the account holder turns 18, the bank will need to update the account by collecting fresh documents and signatures.
If the account was previously managed by parents, the bank will also confirm the account ownership and verify the balance.
Facilities Like ATM, Internet Banking May Be Available
Banks may offer ATM cards, internet banking, and cheque books to children, depending on their own policies.
These facilities are not mandatory, but optional for the bank to provide.
No Overdraft Allowed
Children’s accounts cannot have an overdraft facility. This means the account holder can only use the money available in the account, not more than that.
KYC Is Mandatory
Just like regular accounts, KYC (Know Your Customer) documents related to the child’s identity and address must be provided at the time of opening the account and updated in the future as needed.
Rule Effective from July 1, 2025
RBI has instructed all banks—public, private, and cooperative banks—to change their policies and implement the new rule by July 1, 2025.
This move is expected to boost financial awareness and smart money habits among children, preparing them for better money management in the future.
