Now Minors can open account in their name with Mother as guardians – Reserve Bank of India.
To promote the objective of Financial Inclusion (FI) and also to bring uniformity among banks in opening and operating minors’ accounts, Reserve Bank of India (RBI) has advised all banks operating in India to allow a minor to open account through his/her natural or legally appointed guardian.
However, RBI instructed banks last fiscal that minors above the age of 10 years may be allowed to open and operate savings bank accounts independently, if they so desire and banks may fix limits in terms of age and amount up to which minors may be allowed to operate the deposit accounts independently.
Minors account with Mother as guardians:
The RBI has felt that difficulty was experienced by women customers in opening bank accounts in the names of minors, with mothers as their guardians. Presumably, the banks were reluctant to accept the mother as a guardian of a minor, while father is alive in view of section 6 of the Hindu Minority and Guardianship Act, 1956, which stipulates that the father alone should be deemed to be the guardian in such case.
To overcome this legal difficulty and to enable the banks to open freely such accounts in the name of minors under the guardianship of their mothers, it was suggested that the above provisions should be suitably amended. The amendment of that section would solve the problem for Hindus while Minors’ of other community would still be left out unless the laws governing these communities are also likewise amended.
RBI in it’s Master Circular on Customer Service in Banks dated July 1, 2014 said that the legal and practical aspects of the above problem were examined in consultation with the Government of India and it was advised that if the idea underlining the demand for allowing mothers to be treated as guardians relates only to the opening of fixed and savings bank accounts, there would seem to be no difficulty in meeting the requirements as, notwithstanding the legal provisions, such accounts could be opened by banks provided they take adequate safeguards in allowing operations in the accounts by ensuring that the minors’ accounts opened with mothers as guardians are not allowed to be overdrawn and that they always remain in credit. In this way, the minors’ capacity to enter into contract would not be a subject matter of dispute. If this precaution is taken, the banks’ interests would be adequately protected.