Importance of registering nomination in banks

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Sir,

One recent incident by my close relative on claiming amount from the SB account of the deceased prompted me to write this letter.

My uncle expired last month due to old age. He had all his accounts and transactions in one of the nationalised banks. His family members approached his bank to claim the deposits and contents of locker. Since my uncle had nominated his term deposits, which were renewed periodically, there was no issue in settling the amounts held in these deposits.

However the problem started in his SB account and locker account which were opened more than four decades ago. Since the present AOF for SB, locker and term deposits has a provision to appoint or reject nomination/s, the claims are being settled without any legal hurdles.

Banker takes care of KYC of legal heir/s and transfers the amount to them which is the easiest procedure for both banker and depositor.

You can imagine the position if there is no nomination in old accounts and hence I wish to explain the importance of registering nomination particularly in old accounts in banks (namely SB and locker) to avoid problems to their legal heir/s.

Customers need to obtain acknowledgement for having registered their nomination. Issuing signed acknowledgement, with serial number, is also mandatory for the bank.

Contents of this letter, if read casually, appears very small issue, but imagine the plight of the legal heirs if the claim has to be made without nomination by approaching related Government Office/s, which frustrate general public for one reason or the other.