On 28-10-2025, the Reserve Bank of India (‘RBI’) notified the RBI (Nomination Facility in Deposit Accounts, Safe Deposit Lockers and Articles kept in Safe Custody with the Banks) Directions, 2025, aimed at simplifying claim settlement procedures following the death of a bank customer.
These directions will come into force from 1-11-2025.
Key Points:
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The new Directions are issued under:
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Section 35-A of the Banking Regulation Act, 1949,
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Sections 45ZA to 45ZG of the Banking Laws (Amendment) Act, 2025
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Banking Companies (Nomination) Rules, 2025.
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These Directions apply to all banks, including:
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Scheduled Commercial Banks
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Cooperative Banks
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Regional Rural Banks
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State Bank of India and its associates
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The Directions cover:
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Deposit Accounts
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Safe Deposit Lockers
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Articles kept in Safe Custody
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Accounts held for proprietorship businesses are treated as individual accounts for the purpose of nomination.
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Banks will offer the nomination facility at the time of account opening and clearly explain its benefits, such as:
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Expedited claim settlement
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Smooth transfer of funds or assets to the nominee.
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Customers can decline to nominate anyone. In such cases:
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Banks will be required to obtain a written declaration or record the refusal.
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No account opening can be denied or delayed due to non-nomination.
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Banks will be required to process nomination requests, whether for registration, cancellation, or changes, within three working days.
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Banks will acknowledge receipt of forms and inform customers of any rejections with clear reasons, also within three days.
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To ensure transparency, banks will:
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Mark “Nomination Registered” on passbooks, account statements, and term deposit receipts
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Print the nominee’s name on these documents.
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If a nominee dies before receiving the deposit, the nomination becomes void, and the bank will follow the RBI’s (Settlement of Claims in respect of Deceased Customers of Banks) Directions, 2025.
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Additionally, banks are expected to promote awareness of the nomination facility through printed materials, awareness campaigns, and by including nomination fields in account opening forms.
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With the implementation of these directions, all previous RBI circulars on nomination stand repealed. Actions taken under earlier instructions remain valid, provided they complied with the rules in force at the time.