Several Founders, Co-Founders, CXO Bankers, CXO Fintech professionals & people who participated in the ePanel discussions:

  • Mr. Sugata Dutta, International Training Assessor & Banking Domain expert for E-Learning Platforms
  • Mr. Dinesh Kumar, Senior Manager – Project Management (Credit Business Solutions), South Indian Bank
  • Mr. Prasanna Divekar, Principal, Renaissance India Partners
  • Mr. P B Prakash, Head-Financial Institutions Group, IndusInd Bank
  • Mr. Neeraj Chandra, Head of Operations and Technology, India, Abu Dhabi Commercial Bank
  • Mr. Ajay B Panicker, CEO & Founder, NetPay Limited
  • Mr. Maneesh Mittal, Senior Vice President, Reliance Brands Limited
  • Mr. Rukmani K Narayan, VP Internal Audit, Equitas Small Finance Bank
  • Mr. Vikas R Panditrao, Co-Founder, Forum of Industry and Academic Knowledge Sharing (FIAKS)
  • Many other CEO/CXO Bankers & Fintech professionals on FIAKS Forum requested to remain anonymous

RBI, on 18-August-2021, issued a circular containing comprehensive guidelines for operations in safe deposit lockers. In that circular, one para (5.3.2) inter alia states that the survivor in a joint (either or survivor) locker holds the contents of the locker in trust for legal heirs of the deceased co-hirer. [1]

Thereon, one of the community members raised concern regarding this, to his mind that is incorrect. While that is valid for a nominee, it should not be so for the survivor in a joint locker account.

  • Seems a valid point! As there is no nominee, as per law the assets held under the safe locker by the deceased fall under laws of inheritance. So providing trust rights to the survivor is not correct who may or may not be a legal heir to the estate left behind by the deceased.

However, there are 2 points to be noted here;

  • The survivor is merely a trustee to the estate which means it absolves him/her from accessing the estate unless he/she is also a legal heir.
  • This reduces another complexity under bailment where bailee is liable for the transfer of safe custody to persons i.e. legal heirs who were not the bailor. So if we go by verbatim of the Indian Contract Act, it is the duty of the bailee to transfer the asset to the bailor who in this case was a survivor and all the more it makes the bank’s job much easy.

Now some of the members put forth perspectives regarding the understanding of a locker and ownership; 

  • By definition, a locker is hired by only one person. The co-hirer only has access rights.
  • The customer is merely hiring the locker space for keeping things safe. The mere presence of an article in the locker does not define its ownership. People who can operate the locker do not necessarily become its owner. Ownership and custody are different.
  • Let’s take an example. In a family, valuables are kept in a locker, and if I have, say 2 children, one a major and the other one a minor. I keep the locker to be operated by myself and my major child. Does this mean that the minor child has no stake in those valuables?
  • Let’s take another example. If a friend keeps some valuables with me for safe custody, and I keep them in the locker, does the ownership transfer to me or the other joint holders of the locker?
  • Ownership of all assets including cash and bank deposits is not proven by mere possession. You can deposit someone else’s money in your account but that doesn’t make it your own. The only concession is that if you transfer the money to a third party through a cheque, the receiver will get full title to the money despite your defective title. (It is unclear if those who receive money through NEFT, RTGS, etc get the same protection )

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