Module: | KYC, NPAs, Advances & Investment Valuations
Q196: Consider the following statements regarding the settlement of claims in respect of deposit accounts of deceased customers:
1. Access and payment granted to a nominee or survivor strictly constitutes full discharge of the bank's liability, as they receive the funds purely as a "trustee" of the legal heirs.
2. For deceased accounts without a nominee, the "threshold limit" for a simplified claim settlement without requiring a Succession Certificate is strictly fixed at ₹1 Lakh across all banks.
3. A bank must settle a claim in respect of deposit accounts within a maximum period of 15 calendar days from the receipt of all required documents.
4. If the bank delays the settlement of a deposit claim beyond the mandated timeline, it must pay compensation at a rate not less than the prevailing Bank Rate plus 4 percent per annum.
Which of the statements given above is/are correct?
2. For deceased accounts without a nominee, the "threshold limit" for a simplified claim settlement without requiring a Succession Certificate is strictly fixed at ₹1 Lakh across all banks.
3. A bank must settle a claim in respect of deposit accounts within a maximum period of 15 calendar days from the receipt of all required documents.
4. If the bank delays the settlement of a deposit claim beyond the mandated timeline, it must pay compensation at a rate not less than the prevailing Bank Rate plus 4 percent per annum.
Which of the statements given above is/are correct?
✅ Correct Answer: A
The correct answer is A. Statement 1 is correct: The regulatory guidelines clarify that the nominee is merely a "trustee" for the legal heirs, and any payment made to them fully discharges the bank's legal liability.
Statement 2 is incorrect: The framework explicitly defines the threshold limit for simplified deceased claims without a nominee as ₹5 Lakh (or such higher limit as fixed by the bank's board), not ₹1 Lakh.
Statement 3 is correct: The rules enforce a strict 15-calendar-day timeline for banks to settle deceased deposit claims after receiving complete documentation.
Statement 4 is correct: The mandate enforces a heavy penalty for delayed settlement, calculating the compensation at the prevailing Bank Rate plus 4 percent per annum.
Statement 2 is incorrect: The framework explicitly defines the threshold limit for simplified deceased claims without a nominee as ₹5 Lakh (or such higher limit as fixed by the bank's board), not ₹1 Lakh.
Statement 3 is correct: The rules enforce a strict 15-calendar-day timeline for banks to settle deceased deposit claims after receiving complete documentation.
Statement 4 is correct: The mandate enforces a heavy penalty for delayed settlement, calculating the compensation at the prevailing Bank Rate plus 4 percent per annum.