Rules Governing Repayment Clauses

Bank deposit accounts are opened with the repayment/survivorship clause as under: • Either or survivor Under this clause, the depositor wants that the bank should invoke this clause and pay the proceeds to either of them on maturity of the deposit or on the death of the depositor. Consumers need to understand that this clause is meant only for deposits held by more than one depositor but not more than two persons. The role of ‘nominee’ arises only in the case of death of both the depositors. • Anyone or survivor Under this clause, the depositor instructs the bank to dispose of the proceeds to any one of the depositors individually on maturity of the deposit or to the survivor amongst the depositors on death of any one of the depositors. The role of ‘nominee’ arises only on the death of all the depositors. • Former or survivor/latter or survivor Under this clause, the depositor instructs the bank to pay the primary depositor on the maturity of the deposit and to the survivor on the death of the former\latter as the case may be. The role of ‘nominee’ arises only on the death of all the depositors.

Basically, RBI says that ‘in the case of a joint deposit account, the nominee’s right arises only after the death of all the depositors’. It also says, ‘…there cannot be more than one nominee in respect of a joint deposit account…’

Making Claim As a Nominee

Once the death of the depositor is known to the bank, the bank, as per accepted banking practices, flags the account by blocking any debits to that