Bank Account Nominee Rule: Now, bank account holders can designate up to four nominees instead of just one. This change aims to minimize disputes over inheritance and comes after the Banking Laws Amendment Bill was approved by the Rajya Sabha.
Better to know a out the bank account nominee rule
The goal of this update is to offer more flexibility in how financial assets are distributed and to decrease the number of unclaimed deposits in banks. Previously, account holders could only name one nominee who would receive funds from their account after their passing. With the new rule, they can now choose up to four nominees, making it easier to allocate their money as they see fit.
Who can be selected as nominee
For instance, an account holder can name their spouse, parents, and children as nominees and decide how much each will receive. The amendment introduces two nomination methods: Simultaneous and Successive. These methods will facilitate a smoother distribution of funds after the account holder’s death.
The first method, Simultaneous Nomination, allows the account holder to specify how their total deposit will be shared among the nominees. For example, if someone has Rs 10 lakh in their account and three nominees, they could split it in a 40:30:30 ratio. This means the first nominee would receive Rs 4 lakh, while the second and third would each get Rs 3 lakh.
The second method, Successive Nomination, prioritizes the order of nominees. If the first nominee is unavailable, the funds will go to the second nominee. Additionally, the rules for bank locker nominations have been updated. Both nomination methods (simultaneous and successive) apply to bank accounts, but only the successive method is permitted for bank lockers. This means that if the first nominee is not available, the next in line will be eligible to access the locker.