Starting November 1, bank depositors in India will be able to nominate up to four persons for their accounts, as the Banking Laws (Amendment) Act, 2025 comes into effect. The new provision replaces the earlier rule that allowed only one nominee, a move aimed at simplifying fund claims and reducing disputes among legal heirs.
Under the revised norms, depositors can specify the share of each nominee, ensuring the total equals 100%. This will enable account holders to distribute their deposits among multiple nominees — such as a spouse and children — in proportions of their choice.
Banking sources indicate that the new framework is designed to enhance convenience and transparency in succession matters. In the previous system, a single nominee often acted merely as a custodian, while the actual right to the funds rested with legal heirs. This sometimes led to confusion and family disputes after the depositor’s death.
The amended provisions allow customers to nominate their legal heirs directly and specify their individual entitlement, reducing the need for legal intervention.
A new clause has also been introduced for successive nominations, which means that the second nominee’s right becomes active only upon the death of the first nominee.
For instance, a depositor can name their spouse as the first nominee and their children as successive nominees, ensuring that the claim automatically transfers if the spouse dies before accessing the funds.
According to the Reserve Bank of India, as of June 2025, banks held ₹67,003 crore in unclaimed deposits. Officials believe that greater flexibility in nomination could help reduce such cases by allowing depositors to record their intent more clearly.
The move, therefore, is expected to improve claim settlements and reduce the accumulation of unclaimed funds over time.
The multi-nominee facility will apply only to deposit accounts. Since items in lockers cannot be valued in monetary terms, banks will allow only successive nominations for lockers, not simultaneous ones.
While the process of claiming deposits becomes simpler, experts clarify that nomination does not override inheritance laws. The legal heirs continue to hold the final right to the funds. The revised rules, however, make it easier for banks to release money quickly and for families to avoid disputes over access to funds.
