MUMBAI: India’s central bank is moving to simplify how banks release funds or valuables belonging to deceased customers. Reserve Bank of India will impose a single, standard procedure for settling such claims for both deposits and safe-deposit lockers. This will replace the patchwork of rules that currently varies from bank to bank. A draft circular will soon be released for public consultation. The reform builds on provisions in the Banking Regulation Act, 1949, which require a nomination facility to help survivors, nominees and legal heirs access funds or property quickly, without unnecessary bureaucratic hurdles.The RBI also announced a new auto-bidding feature for its Retail Direct platform, allowing investors to place automatic bids for both investment and re-investment in Treasury-bill auctions. The system is meant to help individuals plan investments more systematically. Retail Direct, launched in 2021, allows retail buyers to purchase government securities in both primary and secondary markets, and has steadily added features, which include a mobile app rolled out in May 2024, to make direct investment in sovereign debt more accessible.Banks in India follow varying procedures to release funds or valuables when an account or locker holder dies, depending on whether there is a nominee, a survivorship clause, or multiple legal heirs.
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