New Nomination Rules in Banking To Take Effect From November 1

The Central Government has announced that updated nomination provisions under the Banking Laws (Amendment) Act, 2025 will come into effect from November 1, 2025. These provisions aim to simplify and streamline the nomination process for bank deposits, lockers, and articles in safe custody, ensuring faster and clearer settlement in the event of a depositor’s death. These new rules are part of broader reforms to improve governance, customer service, and depositor protection in India’s banking system.

What’s Changing?

Sections 10, 11, 12, and 13 of the amended law will enable depositors to nominate up to four individuals for each facility. These can be assigned either simultaneously (jointly) or successively (in order of priority) depending on the type of asset.

Key Features of the New Nomination Rules

1. Deposit Accounts

• Simultaneous nominations allowed.
• A depositor can assign up to four nominees, each with a specified percentage share of the total deposit (must add up to 100%).
• Also permits successive nominations—where the next nominee becomes eligible only if the previous one has passed away.

2. Safe Custody & Lockers

• Only successive nominations permitted.
• A maximum of four names can be added in a strict order of priority.

3. Flexibility and Clarity

• Customers now have more control over who can claim their bank assets.
• Nominees and their entitlements must be clearly declared to avoid disputes later.
• Ensures speedy claim settlements and reduces legal or procedural delays.

Government and Regulatory Framework

The rules fall under an amendment covering five major banking laws,

• Reserve Bank of India Act, 1934
• Banking Regulation Act, 1949
• State Bank of India Act, 1955
• Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980
• Earlier changes (Sections 3 to 5 and 15 to 20) came into force from August 1, 2025. The upcoming provisions are focused solely on nomination facilities.

The government also confirmed that new procedural rules—the Banking Companies (Nomination) Rules, 2025—will soon be notified. These will outline the forms and formalities for,

• Making a nomination
• Cancelling an old nomination
• Modifying an existing nomination