What changed
RBI has replaced earlier fragmented instructions with a single, harmonized framework for settling claims of deceased customers. The new directions standardize documentation and procedures across all commercial and co-operative banks, setting clear threshold limits for simplified settlement: ₹5 lakh for co-operative banks and ₹15 lakh for others. Banks can set higher limits if they choose.
What it means for you
Banks must now follow a uniform, simplified process for claim settlements, reducing discretion and delays. The standardized approach will minimize customer complaints and legal hassles, especially for smaller claims. Banks need to update their internal policies, train staff, and align systems by the March 2026 deadline to avoid compliance gaps.
What you must do
- Review and update your bank's claim settlement policies and procedures to align with the new RBI directions by March 31, 2026.
- Train branch staff and claims processing teams on the standardized documentation and threshold limits for deceased customer claims.
- Ensure your core banking system and forms are updated to capture the new definitions, including 'accounts with survivorship clause' and 'threshold limit'.
- Communicate the changes to customers, especially nominees and survivors, to set clear expectations on faster claim processing.
Who it affects
All commercial banks (public, private, foreign), All co-operative banks (urban and rural), Deposit account holders and their nominees, Safe deposit locker hirers and their survivors, Customers using safe custody services
What is the new threshold limit for simplified claim settlement?
For co-operative banks, the threshold is ₹5 lakh; for all other banks, it is ₹15 lakh. Banks can set a higher limit if they wish.
When must banks implement these new directions?
Banks must implement the directions as expeditiously as possible, but no later than March 31, 2026.
Do these directions apply to government savings schemes like PPF or SCSS?
No, these directions do not apply to government savings schemes administered by banks. Those will continue to follow their respective scheme provisions.