What changed
Earlier, RRBs could only open minors' accounts with mothers as guardians. Now, any natural or legally appointed guardian can open accounts for minors of any age. Minors above 10 years may independently operate savings accounts, and banks can decide documentation and limits based on risk management.
What it means for you
This circular expands financial inclusion by simplifying minor account opening for RRBs. Banks can now offer ATM/debit cards, cheque books, and internet banking to minor accounts, subject to strict no-overdraft rules. RRBs must update their KYC and risk policies to accommodate independent minor operations and guardian-managed accounts.
What you must do
- Update internal policies to allow minor accounts through any natural or legal guardian, not just mothers.
- Set clear age and amount limits for minors aged 10+ to independently operate savings accounts.
- Define minimum documentation requirements for minor accounts as per your risk management framework.
- Ensure minor accounts (including those with additional facilities) never go into debit; monitor regularly.
- On minor attaining majority, obtain fresh operating instructions and specimen signature for continued operations.
Who it affects
Regional Rural Banks (RRBs), Minors and their guardians, RRB branch operations and compliance teams
Can a minor below 10 years open a bank account in an RRB?
Yes, a minor of any age can open a savings/fixed/recurring deposit account through a natural or legally appointed guardian.
What additional banking facilities can RRBs offer to minor accounts?
RRBs may offer ATM/debit cards, cheque book facility, and internet banking (when permitted), provided the account is never overdrawn and always remains in credit.
What happens when a minor turns 18?
The erstwhile minor must confirm the balance. If the account was operated by a guardian, fresh operating instructions and specimen signature of the now-major account holder must be obtained.