Opening of and operation in deposit accounts of minors

भारतीय �रज़वर् बैंक RESERVE BANK OF INDIA RBI/2025-26/26 DOR.MCS.REC.17/01.01.003/2025-26 April 21, 2025 All Commercial Banks All Primary (Urban) Co-operative Banks All State Co-operative Banks and District Central Co-operative Banks Madam/ Dear Sir, Opening of and operation in deposit accounts of minors Reserve Bank of India has issued guidelines in the past to banks on opening of and operations in the deposit accounts of minors. A review of the existing guidelines has been made with a view to rationalise and harmonise the extant guidelines. 2. Based on the review, the revised instructions on opening and operation in the deposit accounts of minors are given below: (a) Minors of any age may be allowed to open and operate savings and term deposit accounts through his/ her natural or legal guardian. They may also be I allowed to open such accounts with mother as guardian in terms of RBI’s Circular DBOD.Leg.BC.158/C.90(H)-76 dated December 29, 1976. (b) 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. िविनयमन िवभाग, केंद्रीय कायार्लय, 12वी ंऔर 13वी ंमंिज़ल, केंद्रीय कायार्लय भवन, शहीद भगत िसंह मागर्, मुंबई 400001 टेलीफोन /Tel No: 22601000 फै�/ Fax No: 022-2270 5670, 2260 5671, 5691 2270, 2260 5692 Department of Regulation, Central Office, 12th & 13th Floor, Central Office Building, Shaheed Bhagat Singh Marg, Mumbai – 400001 Tel No: 22601000 Fax No: 022-2270 5670, 2260 5671, 5691 2270, 2260 5692 बैंक िहंदी में पत्राचार का �ागत करता है Caution: RBI never sends mails, SMSs or makes calls asking for personal information like bank account details, passwords, etc. It never keeps or offers funds to anyone. Please do not respond in any manner to such offers.(c) On attaining the age of majority, fresh operating instructions and specimen signature of the account holder shall be obtained and kept on record. Moreover, if the account is operated by the guardian, the balance shall be got confirmed. The banks shall take advance action, including communicating these requirements to minor account holders attaining the age of majority, to ensure fulfilment of these requirements. (d) 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. (e) The banks shall ensure that accounts of minors, whether operated independently or through a guardian, are not allowed to be overdrawn and that these always remain in credit balance. (f) The banks shall perform customer due diligence for opening of deposit accounts of minors and undertake ongoing due diligence, as per the provisions of Master Direction on Know Your Customer (KYC) Direction, 2016 dated February 25, 2016, as amended from time to time. 3. The above guidelines are issued under sections 35A and 56 of the Banking Regulation Act, 1949. Banks are advised to make new and/ or amend existing policies to align them with these guidelines, latest by July 01, 2025. In the meanwhile, existing policies may continue. 4. The circulars tabulated in the Annex shall stand repealed from the effective date of this circular. Yours faithfully (Veena Srivastava) Chief General ManagerAnnex List of guidelines issued on minor deposit accounts Sl. Circular Date Title of the circular No. 1 RPCD.No.RF.DIR.BC.32/D. January 08, Opening of Bank Account in the 1-85 1985 Name of Minor with Mother as Guardian 2 UBD.(DC)1148/V.1-84/85 February 22, Opening of a Bank Account in the 1985 Name of Minor with Mother as Guardian 3 DBOD.No.Leg.BC.19/C.90( September 08, Opening of Bank Accounts in the H)-89 1989 Names of Minors with Mothers as Guardians 4 DBOD.No.Leg.BC.28/C.90( October 06, Opening of Bank Accounts in the H)-89 1989 Names of Minors with Mothers as Guardians 5 UBD.DC.1/V.1-89/90 January 02, Opening of Bank Accounts in the 1990 Names of Minors with Mothers as Guardians 6 DBOD.No.Leg.BC.108/09.0 May 06, 2014 Opening of Bank Accounts in the 7.005/2013-14 Names of Minors 7 UBD.BPD.(PCB).Cir.No.61/ May 12, 2014 Opening of Bank Accounts in the 13.01.000/2013-14 Names of Minors 8 RPCD.CO.RRB.BC.No.100/ May 12, 2014 Paragraph 4.10 (Opening 03.05.33/2013-14 accounts in the name of minors with Mothers as guardians) of Annex to the circular on ‘Customer Service in Regional Rural Banks’ 9 RPCD.CO.RRB.BC.No.104/ May 27, 2014 Opening of Bank Accounts in the 03.05.33/2013-14 Names of Minors 10 RPCD.CO.RCB.BC.No.29/0 September 09, Opening of Bank Accounts in the 7.51.010/2014-15 2014 Names of MinorsDBOD.No.Leg.BC.158/C.90(H)-76 December 29, 1976 All Commercial Banks Dear Sirs, Opening of Bank Accounts in the Names of Minors with Mothers as Guardians It has been brought to our notice that considerable difficulty is being experienced by women customers in opening bank accounts in the names of minors, with mothers as their guardians. Presumably, the banks are reluctant to accept the mother as a guardian of a minor, while father is alive in view of section 6 of the Hindu Minority and Guardianship Act, 1956, which stipulates that the father alone should be deemed to be the guardian in such case. To overcome this legal difficulty and to enable the banks to open freely such accounts in the name of minors under the guardianship of their mothers, it has been suggested in some quarters that the above provisions should be suitably amended. While it is true that an amendment of the above Act may overcome the difficulty in the case of Hindus, it will not solve the problem for other communities as minors belonging to Muslim, Christian, Parsi Communities would still be left out unless the laws governing these communities are also likewise amended. 2. The legal and practical aspects of the above problem were, therefore, examined by us in consultation with the Government of India and we are advised that if the idea underlining the demand for allowing mothers to be treated as guardians relates only to the opening of fixed and savings bank accounts, there would seem to be no difficulty in meeting the requirements as, notwithstanding the legal provisions, such accounts could be opened by banks provided they take adequate safeguards in allowing operations in the accounts by ensuring that the minors' accounts opened with mothers as guardians are not allowed to be overdrawn and that they always remain in credit. In this way, the minors' capacity to enter into contract would not be a subject matter of dispute. If this precaution is taken, the banks' interests would be adequately protected. We shall therefore, be glad if you will kindly apprise all your branches of the position as stated above and instruct them to allow minors' accounts (fixed and savings only) with mothers as guardians to be opened, whenever such requests are received by them, subject to the safeguards mentioned above. Yours faithfully, Sd/- P.R. Kulkarni Dy. Chief Officer