Banking Amendment Bill: The Banking Laws (Amendment) Bill, 2024 will be discussed in the winter session of Parliament on Monday. This bill is an attempt to increase customer protection and make the banking system more transparent and flexible. This bill introduced by Union Finance Minister Nirmala Sitharaman proposes significant changes in the Reserve Bank of India Act, Banking Regulation Act, and State Bank of India Act.

Now there isa rovision for 4 nominees in one account.

The most interesting provision of the bill is that now bank account holders can name four nominees instead of one. Account holders can choose the nominees on a priority basis or decide on their shares. Under priority nomination, the rights of the nominees will be applied in sequence, i.e. the next nominee will be effective only after the death of the first, second, or third nominee.

This change will not only give customers more options but will also ensure the safety and distribution of their funds. This provision will also apply to lockers and safe custody.

Unclaimed deposits will be used in the right direction

The bill provides for classifying idle balances, dividends, or FDs for 10 years as 'unclaimed deposits' and transferring them to the Investor Education and Protection Fund (IEPF). It aims to ensure the proper utilization of idle funds in banks.

Management will get expansion in co-operative banks

Under the bill, the tenure of directors of cooperative banks will be increased from the current 8 years to 10 years. However, this will not apply to chairmen and whole-time directors.

Clarity and strength in banking regulations

The limit of substantial interest in bank directorship has been increased from Rs 5 lakh to Rs 2 crore. Apart from this, the deadline for regulatory reporting is proposed to be extended to the 15th and last date of every month. This step will make the administrative processes of banks more effective.

Effects and objectives of the bill

TTThisill aimaims toprove customer facilities,increasee e transparency of banks, and ensure better management of idle funds. In particular, the provision of 4 nominees will provide more options and security to the customers.

It is worth noting that this bill can prove to be a big change in the banking system of India. Passing of this bill in this session of Parliament will be important for both the customers and the banking sector.