What changed
RBI observed that some co-operative banks fail to provide written acknowledgment for nomination forms as required under the Co-operative Banks (Nomination) Rules, 1985. The circular reinforces the existing rules, requiring banks to implement a proper system for acknowledging nominations, cancellations, or variations, and to record the nomination status on passbooks and term deposit receipts.
What it means for you
Co-operative banks must now ensure strict compliance with nomination rules, including mandatory acknowledgment for all customers. This reduces legal ambiguity for depositors' families in case of death and enhances transparency. Banks need to update their systems to print 'Nomination Registered' on passbooks and FDRs, and optionally display the nominee's name with customer consent.
What you must do
- Implement a system to provide written acknowledgment for every nomination, cancellation, or variation form filed by depositors or locker hirers.
- Print 'Nomination Registered' on the face of passbooks and term deposit receipts for accounts with active nominations.
- Offer to indicate the nominee's name on passbooks, statements, or FDRs if the customer agrees.
- Ensure compliance is uniform across all branches, regardless of whether the customer requests acknowledgment.
Who it affects
State Co-operative Banks (StCBs), District Central Co-operative Banks (DCCBs), Depositors and locker hirers of co-operative banks
Is it mandatory to give acknowledgment for nomination even if the customer doesn't ask for it?
Yes, RBI directs banks to give written acknowledgment to all customers irrespective of demand, as per the Co-operative Banks (Nomination) Rules, 1985.
Can we refuse to print the nominee's name on the passbook?
The circular advises banks to indicate the nominee's name only if the customer is agreeable. If the customer does not consent, you are not required to print it.
What should we do if our current system doesn't print 'Nomination Registered' on passbooks?
You must upgrade your system to record and display the nomination status on passbooks and FDRs. This is a compliance requirement effective from the date of the circular.