Procedure for Opening and Operating Deposit Accounts Syllabus : 3.1 Deposit Accounts 3.2 Procedure for Opening A Deposit Account 33 Procedure for Operating A Deposit Account 3.7 Types of Account Holders 3.1__Deposit Accounts : deposits into lending activities. portant function of the bank is accepting deposits from ¢ same in lending activities. For this the banks run ts the bank is required to open an account with the bank by ‘in amount of money and then start transacting with the tis a current account, savings aceount, or other type ‘a banking institution that allows money to be deposited and withdrawn by the aecount holder.Fo Servo. prunesrrnee ‘ Ditteront types of Deposit Accounts : Current Account : q Q fined as, ‘an account which can be operated of account has no limit on number of long as there is adequate balance in the account, the bank has an obligation to allow such withdrawals These deposits are operated by entities such as businessmen, corporat firms, joint stock companies, public authorities, Their di ‘transactions are in large numbers and in large volumes, Key Features of Current Account : A current account sims at providing convenience to the customers Since operating current account carvies significant cost, earrent accounts do not earn any interest, : At times, banks impose incidental changes for the services that it provides, Current account-holder also enjoys certain privileges such as overdraft fecility, loans and advances by the banks, depositing of third-party ‘and cheques with endorsement for collection and credit Savings account aims at helping the people with limited income to save © portion of their income, in of with future needs, Saving account has certain res on withdrawal and the bank ays.a reasonable interest on the balance, Bank offer facilities for saving account-holder such as depositing and collection cheques, drafts, ete. There is significant increase in the ‘mobilisation of saving deposits in the past two decades, Features of Saving Account : (@) (oy © ‘There are restrictions on withdrawal of money. ‘The RB. determines the rate of interest payable on the saving account. It is paid quarterly or over a longer period on the minimum balance in the account. The accountsholder can deposit any amount in the account. The ‘minimum amount to be deposited is Rs.5, (©) Bank imposes service charge of Rs.10/- per annum on the saving llowing entities to open a saving account : Any trading and bu ion ions/departments, endent on grants and subsidies provided by government, * Local government organisation, * State housing and water and sewerage bodies, (3) Fixed Deposit Account : * Fixed deposit accounts are also known as term or time deposite, The Period of holding the fixed deposit with the bank is fixed as per the depositor’s discretion, * In case of fixed deposit, since the term or maturity period ofthe deposit 's fixed, the bank is not required to maintain any cash reserves with itselt, Important Features of the Fixed Deposits : ) Fixed deposits are categorised vari has a variated rate of interest. Longer types. Each of these categories We term of the deposit, higher the W fixed deposits before maturity, maturity date and the renewal period Aeposit ‘The R.B.I has the power to change the rate of interest from time to time. The acheduled commercial banks with aggregate deposit liabilities lees than Rs.26 crores have been allowed to pay a rate higher by 0.25% over the prescribed limit, ing or Cumulative Deposit Accounts : + Arrecurring deposit can be called as a combination of saving and fixed ‘eposits, The interest rate payeble ia higher than that paid on savings ‘account and'less than that paid on fixed deposit* The application form contains rules relating to conduct of the account, Sepostior Ras te depast an amount, ‘usually in multiple of BSSs, ‘which the customer has to undertake, to accept. BR oo ae read rae pen, ae han Importance of Form : ‘sae indivxdoal as yeuntly or separat ‘OF a guardian if the account is in " rat ae mie a ‘Ths the Si step ofthe relatonsip procs ofthe bank and ‘Tee depositor does mot carn any interest in case sbohe 2) The account opening form is an essential requirement as Soseawnthéraes, 4 ‘he deposst in S months after opening the ascvunt. In provides the detailed information relating to the person desiring ‘case if t is ooed after § months the rate of interest is reduced by to open an account in the bank. AS® and 4%, if ts dosed before 12 months. The interest paid is 1% (8) Such an application is proof ofthe contract between the bank and ‘below the prescribed rate. ifit is terminated after 1 year but before the the customer and the terms and the conditions of the banks. ‘matunty period. By singing such form the customer/account holder agrees to a in n : accept all the terms and conditions as well as mules and cedure For Opening A Depa — regulation of the bank. Tetroduction : (2) Introduetion of the Application: + Today banks hove emerged as important financial institutions Banks + Before opening a savings or current account in the name of an ‘Provide a safe eavironment and help us manage our financial transactions ‘Te avail professional banking service itis mandatory for every individual to ‘identity ofthe applicant. open a bank account. + The applicant must be properly introduced to the banker. Ifbank +The accunt opening formalities differ as per the type of account to be opens an account without proper introduction or shows ‘opened. These formalities are to be followed by the hank as well as the ‘carelessness in this regard, cases of fraud or misrepresentation castomersiiepasitars 3.2(A) Procedure for Opening Current and Saving Accounts : intending customer, it is the responsibility of a bank to prove the cases but the general public may also be deceived by undesirable Opening for current and savings accounts involves following formalities customers. ites co + Therefore, the hdnker must get true identity of the customer in (1) Filling and submitting bank's application form: temuethethene on + For opening account, every bank has its own application form and a Ways of Introduction customer may request the respective bank to open a current or saving ‘Th ccrodiaon ie the agglicant ti be done a bank account in bis name by forwarding an application through this - sevice ee ae ei application fre following three ways. () A person wi the «1 + Usually, different forms are applicable for different types of accounts Peron who has an account in the same branch or whom the :t i 7 ‘specimen signatures, the name and signature of the introducer, ete. in application form. the application form.(2) The application can provide the name of an individual or another bank for reference. The branch may address these referee and probe about the applicants (3) The Reserve Bank of India has instructed the banks to accept identity cards of individuals employed with different units Similarly, for opening an account without the facility of cheques, passport can be accepted. (2) Such introduction prevents bank from fraudulent persons. (2) Introduction of new client may protect the banker from the risk | of stolen cheques or the risk in ease of undischarged insolvent (3) Tokknow the true identity of the applicant such introduction from | existing customer will be helpful. Proof of Residence : + order to open an account in a bank, an applicant hes to give his residence proof Without such proof of residence the banker _j ‘must not alow the customers to open account in the bank I: is | called address proof + Address proof or residence proof establishes that the customer ‘who wants to open an account with the bank has a verifiable address. . + This is critical from a customer service perspective as a significant part of the bank's interaction with the customer ‘occurs through documents seat to the customers either through post ar courier. ‘+The communication address provided by the applicant has to be supported with documentary proof, which bears the same address. Documents Accepted as Residence Proof: (1) Permanent Account Number Intimation letter issued by IT | 4 (4) Sales Tax registration certificate. (5) Valid shop and Establishment Certificate. Validity can ‘extended up to the grace period for reera es ment ia h\ certificate. (6) Any other certificate issued for registration/operatioa/business by \ local/statelcentral Government, ete. Importance: (2) Frauds can be prevented as the residence address is with bank to spot the person involved in such fraud (2) In case of payment by mistake, the bank can collect such amount from the person (3) isthe proof ofthe residence ofthe person thatthe person stays on the address given to the bank. (4) It helps the bank to recover the amount given by the bank as loan or advances to such customers. Specimen Signature : + The applicant is required to give his specimen signature on a prescribed form, usually on a card. These cards are preserved by the bank for the purpose of record keeping. © Once the customer = either by withdrawing money or issuing cheque, bank compares his signature on the withdrawal slip or cheque with his specimen signature + If the signature on cheque or withdrawal slip differs frum the specimen signature, the bank can refuse to give money or to ~ honour the cheque. . ‘The bank ehould be very crf in comparing the signature of the customer given on a cheque or withdrawal slip with his specimen signature withthe bank operating his account, Le, Importance: (2) The specimen signature protects bank against forgery.the interest of the customer. (8) Nomination ; On the death of an account holder his successor or legal heir can claim the balance in the account. However, he has to complete certain legal formalities before claiming the balance in the ‘account of the deceased account holder. ‘To enable their successor or legal heirs to get balances in their Account without completing any legal formality, an account holder can make a nomination in the account. The nominee can claim the amount by producing the death certification of the ‘customer and a proof of his own identity. A nominee acquires the night to ask for the detail of the account and ask for refund of balance in the account only on the death of the customer and has no right to operate the account during the lifetime of the customer. Importance : (2) In case of the death of a customer bank ean hand over the money in the account to such a person named as nominee. oy about the (8) Bank ean pay the amount from the deceased account holder to the legal heir mentioned in the form as a nominee. a Unnecessary litigations can be avoided. (8) Opening the account : ‘After all these formalities are over, an account is opened by the bank in the name of the applicant. Generally, the minimum initial deposit for opening a current account is Rupees 500/- in Urban branches and Rupees 300 in rural branches. .y com - Baking and France 3.2(B) KYC Forms : Introduction : + In order to prevent identity theft, identity fraud, money laundering, terrorist financing, ete. the RBI had directed all banks and financial institutions to put in place a policy framework to know their customers before opening any account. This involves verifying customers’ identity and address by asking them to submit documents that are accepted as relevant proof. Reserve Bank of India has advised banks to make the Know Your Customer (KYC) procedures mandatory while opening and operating the accounts. + This is in the interest of customers to keep safe their hard earned money and their reputation. KYC means Know Your Customer. + This is a requirement stipulated by RBI for bank accounts and also mutual funds and other financial institutions to check money laundering, kite fying, fraudulent transactions, ete ‘+ Finance is one of the basic sources of every act in the world today. Institutes that deal with bank money or trade financial instruments or, any other relevant business the institute does have a set of responsibilities in knowing their customers, This set of responsibilities based un need of « country led to the birth of set of procedure that an individual, a group or any fow of the processes that a person will undergo in KYC. + Reserve Bank of India, the regulatory body of financial institutes in India made KYC compulsory to all banks. + This order was passed in the year 2004 and according to it the objective of KYC is to prevent financial institutes and relevant companies from being used by terrorists and money launderers in a criminal act.fomployment, sources of wonlth nce, expectod monthly tho necount are observed bank may ask for any add ‘expected monthly Femi () For identity proof: Pasaport, ‘ard, Driving Liconce, th mued by the Unique Identification Authority of India containing details of name, address and Andhar Card duly signed by an officer of the Stato Government Confirmation from employer from a pub hority or public servant verifying the identity 1 rosidence of the cuntomer {o the interest of customers to weed out the chancon of frauds happening in the accounta come up with more xpecific guidelines regarding KYC. into four parte wed within the* Customer is to be identified not only while opening the account, but ‘also atthe time when the bank has a doubt about his transactions * For customers that are natural person, banks should obtain sufficient identification data to verify the identity of the customer, his addressfocation and also his/her recent photograph, Monitoring of Transactions : keeping a watch on bigher itoring transactions. ctivity is to be reported to the designated authority to ‘enable them to probe further. (4) Risk management : + This is about managing isiternal work to reduce the risk of any unwanted activity ‘+ This includes managing responsibilities, duties and various audits plus regular employee training for KYC procedures. ‘Need for KYC Norms : Need for KYC norms can be explained as follows (1) To Accepting Legitimate Customers : * The main objective of KYC policy is to accept only legitimate customers. Such policy is needed to identify customers to understand the potential risks they pose. + Its needed to verify that eusvaners are mbo they say they are Tras, KYC policy is needed to ensure that only legitimate and temafide custoriers are acenpted. + Identity of the customers is verified by using reliable and independent documentation (2) To Monitor Transactions : * Ongoing monitoring 1s an essential element of eflective KYC () ToProven Money Laundering : Money laundering refers to conversion of money illegally obtained to ‘smuggling and drug trafficking, financial erimes, etc. + The money laundering by criminals begins by depositing their ill gotten money into an account with a bank, often opened using a false identity and address. +The funds so deposited are transferred to other accounts locally or abroad or used for buying goods or services. These transactions would appear legitimate and becomes difficult to trace it back to its criminal past. + Banks under law should not only prevent this, but should stop criminals who wish to use the banking channel to wash the ill-gotten ‘money from illegal / criminal activities, (4) To Prevent Financial Terrorism : Financial terrorism means financial support to any form of terrorism or to those who encourage, plan or engage in terrorism, ‘+ Money launderers send illicit funds through legal channels in order to conceal their criminal origin while those who finance terrorism transfer funds that may be legal or illicit in original, in such a way as to conceal their source and ultimate use, which is to support financial terrorism:bank as pe: customer is Operating Saving Deposit Account Operating saving account involves the filling up and submitting the followings (1) Payetn Slips ite reputation could be irroparnbly damaged. A strong KYC policy vehicle for i (6) Lega! Complion te. These are slips with perforated counter foils which are ‘0 be filled-up, signed and submitted by depositor or his represer discontinuance of ope + Apart from regulatory risk, involvement to third-party judgments and unenforceat ionals working within many fin 37 may also personally be subject to legal action oF prosecution, Due to the nature of business, these risks can never entirely bo liminat How utinese doesnot have an effective KYC polly, it wil Fisk, By strictly implementing and folowing a KYC | policy, a businos can mitigate legal risk ta ital and its stl. | 23_Procedure for Operating A Deposit Account : | 33_Procedure tor Ope inly for professional men and middlo class people to help wir small savings, Money can bo deposited at any time but ‘There is a restriction on the ‘amount that can bo withdrawn at a particular time or during a week. © Name © Depositor's account number. © Amount of money (in Rs.) to be deposited In case of cash, the denomination of currency notes. In case of cheques, the cheque number, date and details of the drawer bank, © The depos ‘The completely Glled-up slip slong with the cash or cheque is ‘hmitted to the cashier. The cashicr accepts the cheque or cash and ‘cknovledgos its acceptance or receipt by putting a stamp and signing {he counterfil, The slip which is accepted by the bank is sent te concerned offical for ledger entry.ou + However, on request, the depositor can encash the amount before its ‘maturity. In that case banks give lower interest than what w upon. ‘The interest on fined deposit account can be withdrawn at certain intervals oftime. + At the end of the period, the deposit may be withdrawn or renewed for a further period. Banks also grant loan onthe security of fixed deposit MA) Fixed Deposit Accounts : (1) Opening of Fixed Deposit Accounts : . for the of f a fixed deposit account is + Documents required are for proof of identity, address, signature, and in case of senior citizenship, age. Fixed deposits accounts can bbe opened by individuals / partnership firms / private and public limited companies / HUF specified associates / societies / trusts, ete + Tn the case of fixed deposit the depositor has to deposit a lump ‘sum amount at one time for a fixed term and receives payment in ature after the period for which the deposit has been kept ie. on maturity @) Issue of Fixed Deposit Receipt : + Banks issue a separate receipt for every FD because each deposit 18 Weated as a distinet contract. This receipt is known as the Fred Deposit Receipt (FDR), that has to be surrendered to the bank at the time of renewal or encashment. the bank for the opening ent isthe sole discretion of bank, they generally this discretion but accede to the request of ‘depositor for premature withdrawal. + The bank has to declare to the account holders their penal interest rates policy for premature withdrawal of term deposit. Banks pay interest on premature withdrawals at the rate applicable for the period the deposit has been kept less penalty levied. ‘+ FD can be closed before the original term of the FD. In the event of the Fixed Deposit being closed before completing the original term of the deposit, interest will be paid at the rate applicable on the date of deposit, for the period for which the deposit has remained with the Bank + In case of premature withdrawal the deposit may be subject to penal rate of interest as prescribed by the bank on the date of deposit. |No penalty is levied on such pre-payments for renewal. Bank levies penalty for premature withdrawals in case on their non- renewal (4) Loans against Fixed Deposits: When one invests in a bank fixed deposit, one can easily get a Joan against it without having to break it. This is similar to the loan is structured as an overdraft against the fixed deposit proceeds. There are no prepayment penalties to foreclose the loan. ‘There is no restriction on the end use of funds. Banks offer an overdraft facility against fixed deposits. The Bank may consider request of the depositor/s for loan / overdraft facility against term 3.4(B) Recurring Deposits Accounts + Recurring Deposits are a special j banks in India in which people d into their Recurring Deposit accoun It is similar to making Fixed Deposits (FDs) of a certain amount in ‘monthly installments, for example Rs 1000 every month. This deposit ‘matures on a specific date in the future along with all the deposits made every month. Bey scom Thus, Recurring Deposit schemes allow customers with an opportunity to build up their savings through regular monthly deposits of fixed sum over a fixed period of time. Recurring deposit account is generally opened for a purpose to be served at a future date Generally these accounts are opened to finance pre-planned future purposes like, wedding expenses of daughter, purchase of costly items like car, holiday, ete. The main objective of recurring deposit account is to develop regular savings habit. In recurring deposits, a monthly deposit (RD Installment) of pre- ‘The procedure and the documents for the opening of recurring deposits accounts are the same as of opening of savings accounts in the banks, (Please see the procedure for opening savings bank accounts.) (2) Premature Encashment of Recurring Deposits : When the RD account is opened, the maturity value is indicated paid regularly on due dates. But premature withdrawal is allowed. Each institution follows its own premature closure or withdrawal policy. For example, in case of Post Office RD premature closure is allowed after three years. In fact Post Office RD offers part withdrawal facility. In case of State Bank of India loan / overdraft facility is available against the balance in RD account and premature withdrawal is allowed at 1% below the rate applicable for the period the deposit has remained with the bank. While Banks like HDFC and ICICI do not allow partial withdrawal. Premature closure is allowed but with some penalty.no by the acco 10 close the accout 35__ Closure of Accounts :_ Introduction : that there are frequent transactions, and paying maintenance and ol! the bank can termina changes for the services it offe ‘reumstances, the bank must Notice by the Bank ‘The bank has to give @ notice to the customer, requesting him/her to withdraw the balance in the account. The bank should not close the account, customer, ive has to bo served by the bank to the customer exact date on/by which the account is to be closed. The bankers, during this notice period, may refuse to accept any credit of A. second issuing cheque books to the eustomor. ‘There are certain circumstances where account closuro takes place. They aro as followsnse J.¥.8Com -Barkey ar Finance ‘87_Types of Account Holders : 7(A) Types of individual account holders: implemented by 4 minor are nok can be opened by a minor. be opened by @ minor. In case of count can be either operated by minor ir the guardian. ‘Once the minor attains maturity, the account operated by the ‘major is closed by the bank and the balance is paid to the major (Previously ‘inor) or credited to the new account in hisIher nase on whose name the bank account Following are types of individual account holders: (1) Single oF Joint: perated account stands for an account operated by only one {in whose name the account is opened + Joint account means an account opened in the name two or more individuals + Incase of joint account, specific written instructions are given to étllgdna, tanks relating to which members can draw cheques, whether However, the bank has to ensure that she is financially independent pet Gs murviveein while granting her the overdraf facility. While granting loans to her ‘Ti writen, document the bank has to obtain her husband's consent and guarantee. (8) Non-Resident accounts : + Non vant (NRD) are aimed for those Indians who reside const 1 relating to her separate estate signed by all joint account- holders, (2) erate Persons : + Hilterat persons can open accounts in the banks. iterate persons a ray or permanent fr on coset gn tee name tn beac the Basen tke tne err of emaaely fr ding Mf he \mpresmons as 4 substitute for signature, and also a ‘copy: of the te mone 1s stat meas ee nee tered sever ne In India the ena bank bas fled er facilities and concessions to these account-holders + There are two types of (6) Non-resident (External) Accour + Which are opened as India The original deposit amount ‘repatriated outside India at any | * Tee application form and the photograph should be attested by an | ‘prroved witness, For withdrawing money, he must attend personally ; sed affix his thumb impression in the presence of an offical of the ‘bank forthe purpose of identification ‘+ There are certain precautions which need to be taken in case of ‘iterate account holders. ident account, savings or current account in Indian rupee in (capital) and interest earned can be ‘ime. The interest earned is tax fre,‘ign currency account in India. Interest on these deposits is free of tax. (@)_ Pardanashin Women : A pardanashin woman (women following the custom of wearing a 1 bank, provided that all terms and count are explained to her Dburakcha) can open an account ii) the same might not have been made full understanding of what the contrac + Thus, @ contract entered into by a pardani contract free from all defects. The other party to the contract shall have to prove that the contract with her was free from the above mentioned defects in order to enforce the same. ‘The banker should, therefore, take due precaution while opening an account of a pardanashin woman. The bank should enquire about her ion/condition and family members. count holders are cal institutions are the legal entities in the eyes of the law. So they are eligible for ‘opening deposit accounts in the banks. ‘Types of Institutional Account Holders : ynal account holders : Pollowing are the inst | (2) Sole Proprietorship Caceneet the family is known as the karta. Only the karta of the family has the authority to carry on the family business and operate the bank accounts of the HUF. ‘To open a bank account, HUF letter signed by all adult coparceners is required. The leiter affirms that the business carried on is the family’s ancestral business. It binds the family to inform the bank of any change in the family due to death, birth or separation. It also binds the adult coparceners in case the business carried on by them falls beyond the scope of the nor coparceners should be documented to unable resh HUF letter to ratify the earlier transa ing majority. that banks can open a savings account ‘ot engaged in any business activity. In case run any business only current and fixed deposit accounts can be opened, ‘There is no bar on lending money to HUF. Though the karta can bind all the coparceners with his signature bank take the signature of all the coparceners on the security documents when lending money to HUF to guard against the remote possibility of any coparceners disclaiming responsibility. ‘The account of a sole proprietor is not different from the ordinary individual bank account. When the account is opened, the sole es that there are no partners in the business and only the profitability of the business.(3) Partnership Firms : i) Joint Partnership firm Since each partner partners have unlimited li such accounts Legal procedures, to be followed by the bank are ds follows, whil opening partnership account A certified copy of deed of partnership to be obtained by the bu ‘The account should be opened in the name of the firm application form, following details relating to every should be provided, iy Si ie of all partners, their address, nature of business, ions relating to operation of the account, withdrawal ‘and right to mortgage or pledge the firm's property. In case a partner cancel the authority given to other in a written intimation to the bank, payment of cheques issued should be halted. If a partner credits firms cheque in his individual ‘count, other partners should be informed by the bank and their ‘approval should be obtained. For loan applications, the banks should obtain signatures ofall partners. Stock Companies : Joint stock company accounts are prestigious and profitable for the bank. The accounts of joint stock companies are operated either by the Board Director or the Managers. ‘Legal precautions tobe taken by banks in case of joint stock company’s ‘account are as follows: Verification of registration certificate, the articles and memorandum of «association should be obtained and assessed by the bank. To obtain resolution of the Board of Direttors containing specific ‘mention of the bank and its branches, specimen signature by the bank ‘There are some organisations which are established and ran for specific objective. These organisations could be educationa ins, hospitals, sports clubs, charitable institutions, otc. anc sd under one of the acts such as Charitable Trust Acts, Co- ive Societies Act, Companies Act, etc. * The bank has to verify the registration of the organisation. While count in its name the society/organisation should accept ‘resolution indicating the bank and the branch, where the account thas to Le of + This resolu to be obtained by the bank. It should contain the names, addresses and specimen signatures of the Is who would operate the account. A separate resolution ha: by the society for applying for a loan, (6) Trustee Account : © be submitted ‘A trustee is appointed under following circumstances, when some assets are kept aside by an.individual To take care of a minor. Mentally handicapped persons or (©) For some special purpose. (a) Trustee does not have the account in hither name, but is entitled to operate the account for the purpose specified in the trust-deed, 7) Executors and Admini + Executors and admi 5 are appointed to settle the accounts and distribute property of an in ‘appointed by the individus Orr the court. The property ofthe deceased has to be di off as per the will, be disposed examining the letter of probate. ‘The bank has to ensure thy t the broperty of the deceased has not been misused, "— 2 Aone the teach of Secine wk martes of + Harts muna the guacho may se sgpraseed ty Ge coms, wy wend Bees ct ak 2 puss Oil he sue +b maar ome wha Sa at cumin UE peas of age. Bat fa cone ka seen SEY. Summent «Fart Se 4 sor % goaet fat gomen mat peep. oe 2 Me te teats oh mice, puactine io digithe to witiabee Cem ‘hacer we Se sommes Se ¢ mur cll se cumpinnes 2 yearn The cnucrace enteret. porahany 9 ceria Ipecac eee et peel pee crreat ball te perme, miner presen, ame te acme ts Sow sr pie, Sesto: Ka AT, 2 oe in eseage berawtie. Don i cae of lomnen te wil sat be halle Sor esesmery sf trata inet ee esse eae cae eee barre casey 3 wd. Suc 4 cacres can at be catiint een ater the cutmae ended come 4 mon 2 valet canteses She 2 fcPco ee wena povtied jo: peas a + A marred woman i comppiens 1 omnes aK a ¥ Ban merc rai aa per Sn Nae Conese: et. ci ba to be cae Seon cmmprtant 6 So a scans with 2 tank: sar pees mm bee ans Sealing wish mee ows name 2ari om her owen bebeait ae cas Gran cherguea ace ge 2 vali Kartcorgy Wile acorn of inact Ponca te ts ect: wan mecteath twa marred woman, te tector anid samme tae were ‘Wale dealing with a cunor cutomers the hank shenid take the tllowrng leek very caeetlly 5, marred ween cae piece ter parsonal ses ie 1 fer hashes? 9 exgaes, seswnnt say Se agent = The came of 2 ne ater im fk ae 6 a Ur ee cworie a het keeeaad 2 deseaeed "top yun sae of te sr set huaer grates 5 ox the same of faker 2M ch Soaes we salto Sow the wspyhy oh secemcees oh Ne. as cman Coe satan oF egal gets. Sn omeetente Sanity kaweener dhanlt oe grastet. baat debates ox wnppiyang tha 15 tae sariaar HOR Bit Braet 3 lanes 98 screen to 2 moe sect hu Aas + be Ge atone mntioned cormmmetaces 2 married woman fas 2s gia periph a worse) nacnsnn ic 4 pleas lngally our. Thaw Bak 2. ees sothoriny ta pladign her hembra craic. Tiaus, tabaci sll sot be ite, pect est sme a cesnble 35 any other sxrmamatacces for the data talces by hin wie The crediose aay fa aivance can nat he gen om the guaranten of 3 Chart arty alan mes the Peeve the tebna: one oh the sermeat santa of oe woman. the te kan 9 ‘acto oe bases cena ogy Nova paeinal remedy, seach 2 tseeriet wena. 6 trlang a the musor sexmnmt a it 2 cenit balamen, the opercice of the sarried woman kemmever cam agen 2 point semmet with ter feted The seroma ca Gn orm. Ont te baci sue sam Chae 3 det baleen oe ac beaker shonit obeac a cess mandates as to the ommerliy of the talases artentt soni 08 sm amar,i Br vacon tert ws Pearce au Do Sg npr Opa A Deposit account : A deposit arcount is» current account, savings account, or other type of bank account, at a banking institution that allows ‘money to be deposited ‘and withdrawn by the account holder. Different types of Deposit Accounts ; () Current Account (2) Savings Account (3) Fixed Deposit Account (0) Recurring or Cumulative Deposit Accounts Features of current account : (a) Acurrent account ais providing convenience to the customers, current account carries significant cost, current "joys certain privileges such as overdraft woes by the bar endorsement for col Features of savings account : {0) Ther are restrictions on withdrawal of money. (0) Be RBI. determines the rate of interest payable on the saving dic ateentT#rly oF over longer period on the sinimum balance in W account, i (d) The ewunt-holder can deposit any amount in the account. The ‘minimum amount to be deposited is Re.& Features of deposit account : (0) Fixed deposite are categorised into va‘ious types. Each of these dopete Bi Minted rate of interest. The longer the wenn of the deposit, higher the rate of intervat, belore owed renewal of existing fixed ran ae pnt renewal is done before the maturity ; tore than the remaining days ofthe depos mi ns B.I has the power to change the rate of interest from time. nm ‘The scheduled commercial banks with aggregate svi sper than Rs.25 crores have been allowed to pay a rate it liabilities less @ ition ofthe application (9) Proof of residence (4) Specimen signature (6) Nomination (6) Opening the account Documents Accepted as Residence Proof : (1) Permanent Account Number Intimation letter issued by IT authority. sar name, and address of the entity, Bill, not more than 3 months old. old. Latest copy of Blectri Latest copy of Telephone Bill, not more than 4 mot les Tax registration certificate. (5) Valid shop and Establishment Certificate to the grace period for renewal as menti (6) Any other certificate issued for regia local/state/central government, ete. Importance of specimen signature : (@) The specimen signature protects bank against forgery The bank can verify the signature of the customer at the time of withdrawal P bank to provide money to the right person and hence protect ferest of the customer. ty can be extended up ich certificate. mn/operation/business by+ KYC Norms: + Operating Saving Deposit Accounts : forts to determine true identity and beneficial ownership of accounts, sourve of funds, the . nature of customer's ‘business, reasonableness of operations in the account in relation to the customer's business, ete which in turn helps th: banks to manage their risks prodently. tot wm tate mr wn Senta 3) Loans against Recurring Deposits Accoun seg be omealataal + Procedure followed by bank for closure of account : Customer profil 4) Photographs RYC Policy: (Q) Notice by the Bank (2) Bank to Stop Operation of the Account In 2004, the RBI had come up with more specific guidelines regarding KYC. | ‘These were divided into four parts : ; (2) Customer Acceptance Policy+ Types of institutional account holders: (1) Hindu Undivided Pomily (2) Sole Proprietorship (3) Partnership Firms (4) Joint Stock Companies (5) Clubs, Associations and Societies (6) ‘Trustee Account (1) Brecutors and Administrators Explain the itfeent types of eposit accounts. (Section 3.1) Write @ short note on KYC form. (Section 3.2(8)) iat are the needs of KYC norms? (Section 2.2 Wie a short note on closure of account. (Section 3) \Which ave the types of individual account holders? (Section 3.7(A) \Which are the types of insttutional account holders? (Section 3.7(8)) What precautons should be taken by tha bank for opening minor and martied woman account? (Section 3.70) 16 Marks Questions Explein the procedure for opening curent and savings acount. (Section 3.1) Explain KYC noms and KYC polley. (Section 3.218)) ‘Whats the procedure for operating saving deposit account? (Seetlon 3.3) Explan the procedure for opening and operaling fixed and returing deposi! account, (Gection 3.4) ‘Whats the procedure folowed by bank for closure of account? (Section 3.6) Explain he procedure of transfer of account. (Section 3.6)