Banking Laws Bill amends five Acts, changes unclaimed money rules

This Bill amends several existing banking laws to change how banks handle unclaimed money and dividends, update nomination rules for deposits and lockers, and replace 'Friday' deadlines with 'fortnight' deadlines for various banking operations.

Who it concerns: The Reserve Bank of India, banking companies, the State Bank of India, co-operative banks, and individual depositors or locker holders.

What the bill does

• Changes the definition of 'fortnight' to mean the 1st-15th or 16th-last day of a calendar month.
• Replaces 'alternate Friday' deadlines with 'last day of each fortnight' for reporting and other banking obligations.
• Increases the threshold for certain banking regulations from five lakhs rupees to two crore rupees (or a notified amount).
• Extends the tenure limit for co-operative bank directors to ten years.
• Allows nominations for bank deposits and safe deposit lockers to be made in favor of up to four persons, either successively or simultaneously.
• Establishes a priority order for successive nominations and specific conditions for simultaneous nominations (e.g., stating proportions).
• Requires the State Bank of India and nationalized banks to transfer unclaimed dividends, shares, and bond interest to the Investor Education and Protection Fund (IEPF) after seven years.
• Updates references from the Companies Act, 1956 to the Companies Act, 2013 regarding auditor remuneration and IEPF transfers.

Also in the document

• The Bill amends five existing Acts: Reserve Bank of India Act, 1934; Banking Regulation Act, 1949; State Bank of India Act, 1955; and the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980.
• It introduces specific rules for the validity of nominations, stating that non-compliant simultaneous nominations are invalid.
• It specifies that unclaimed money transferred to the IEPF must be utilized as per the Companies Act, 2013.