What changed
RBI issued the Reserve Bank of India (Nomination Facility in Deposit Accounts, Safe Deposit Lockers and Articles kept in Safe Custody with the Banks) Directions, 2025, effective November 1, 2025. These directions align with the amended Sections 45ZA-45ZG of the Banking Regulation Act, 1949 and the new Banking Companies (Nomination) Rules, 2025. Banks must now explicitly inform prospective customers about nomination benefits at account opening and obtain a written declaration if the customer opts out.
What it means for you
Banks must update their account opening processes to include mandatory explanation of nomination benefits and obtain opt-out declarations. This simplifies claim settlement for deceased customers' families, reducing legal hurdles. Banks should train staff and update forms to comply by the effective date.
What you must do
- Update account opening forms and procedures to include nomination facility explanation and opt-out declaration by November 1, 2025.
- Train frontline staff to clearly communicate nomination benefits to all prospective customers.
- Ensure nomination facility is offered for all deposit accounts, safe deposit lockers, and safe custody articles as per the new directions.
- Review and align internal policies with the amended Banking Regulation Act provisions and the Banking Companies (Nomination) Rules, 2025.
Who it affects
All banks including commercial banks, RRBs, and cooperative banks, Deposit account holders, Safe deposit locker holders, Customers using safe custody services
When do the new nomination directions take effect?
The directions come into force from November 1, 2025.
Can a customer choose not to make a nomination?
Yes, if the customer is fully informed about the nomination facility and its benefits, they can opt out by providing a written declaration. The bank must still open the account without restrictions if otherwise eligible.
Do these directions apply to proprietorship accounts?
Yes, if an individual maintains an account for their proprietorship business, it is deemed as that individual's account, and nomination facility must be offered.