On Monday, the reserve bank of india (RBI) gave banks permission to let children over ten open and manage savings and term deposit accounts on their own. The RBI has released updated guidelines for creating and managing minors' deposit accounts.
 
In a circular sent to commercial banks and cooperative banks, the RBI stated that minors of any age may create and manage savings and term deposit accounts through their natural or legal guardian. With their mother acting as their guardian, they might also be permitted to open such accounts.

"Minors above such an age limit not less than 10 years and up to such amount and such terms as may be fixed by the banks keeping in view their risk management policy, may be allowed to open and operate savings/ term deposit accounts independently, if they so desire, and such terms shall be duly conveyed to the account holder," the circular stated.
 
Additionally, new operating instructions and the account holder's sample signature should be acquired and retained on file upon reaching the age of majority.
 
"The banks are free to offer additional banking facilities like internet banking, ATM/ debit cards, cheque book facility, etc, to the minor account holders basis their risk management policy, product suitability and customer appropriateness," the circular stated.
 
The banks will have to make sure that minors' accounts, whether they are run by themselves or with a guardian, never go overdrawn and always have a credit balance.
 
Additionally, the RBI stated that banks must do ongoing due diligence and customer due diligence while opening deposit accounts for minors.

By July 1, 2025, at the latest, the RBI has requested that banks update their current policies or create new ones to conform to the updated standards.
For more interesting updates wa click and follow Indiaherald WhatsApp channel

Find out more:

RBI

SIBY JEYYA

22/04/2025 08:32 AM