The Central Government has announced that starting November 1, 2025, key provisions of the Banking Laws Act, 2025 — Sections 10, 11, 12, and 13 — will come into effect.
These rules focus on deposit accounts, lockers, and custody items, aiming to make the nomination and transfer process smoother after a depositor passes away.
The reform addresses long-standing issues faced by families of deceased account holders, bringing structure, clarity, and transparency to banking procedures.
Up to Four Nominees Allowed for Deposit Accounts
Under the new rules, account holders can nominate up to four individuals for their deposit accounts.
This can be done in two ways:
Simultaneous nominations: All nominees can receive equal or pre-specified shares of the account balance.
Successive nominations: If the first nominee passes away, the next nominee automatically inherits the full share.
This change gives depositors greater flexibility and control over how their funds are distributed.
Locker Nominations Follow a Successive Pattern
For lockers and safe custody items, only successive nominations will be allowed.
This ensures a clear succession chain, reducing the chances of disputes or overlapping claims among heirs.
The goal is to make locker transfers fair, transparent, and legally straightforward, preventing unnecessary complications for families.
Ensuring Transparency and Reducing Disputes
The government has clarified that the Banking Companies Rules, 2025 will provide detailed procedures and forms for making or updating nominations.
With the option of multiple nominees, customers can ensure that their assets are distributed fairly according to their wishes.
This helps minimize future conflicts and delays in transferring funds or property.
Broader Banking Reforms
The Banking Laws Act, 2025 also includes 19 amendments to key financial laws such as the RBI Act, Banking Regulation Act, and State Bank of India Act.
This November rollout is part of a larger government initiative to make India’s banking system more transparent, efficient, and customer-friendly.
