Bank's Policy on Acceptance/operations of deposits from Individuals (Non-Business)

Background:-

In terms of Annual Policy Statement of RBI 2004-05, Banks are required to formulate a transparent and comprehensive policy setting out the rights of the depositors in general and small depositors in particular. This policy should cover all aspects of deposit accounts, charges leviable and other related issues. In line with the guidelines of RBI's -CPPAPS -Banking Operations and IBA our Bank has framed the following as the policy in respect of acceptance/operations of deposits from individuals (non-business)

Applicability:-

• Is applicable for all types of deposits such as Term Deposits, Savings Deposits, Recurring Deposits and Current deposits.
  
  

• Is applicable for the deposits accepted from individual / joint individuals.
  
  

• It would cover deposits accepted by all the branches/offices/extension Counters of the Bank.

Type of Deposit Accounts:-

While various deposit products offered by the Bank are assigned different names, the deposits products can be categorized broadly into following types. Definition of major deposit schemes are as under:

1. 'Demand Deposits' means a deposit received by the bank, which is withdrawable on demand.

2. 'Savings Deposits' means a form of demand deposit which is subject to restrictions as to the number of withdrawals as also the amounts of withdrawals permitted by the Bank during any specified period;

3. 'Term Deposit' means a deposit received by the Bank for a fixed period withdrawable only after the expiry of the fixed period and include deposits such as Recurring / Short Deposits/Fixed Deposits/Monthly Income Certificates/ Quarterly income certificates, Reinvestment Certificate etc.

4. 'Notice deposit' means term deposit for specific period but withdrawable on giving at least one complete banking day's notice.

5. 'Current Account' means a form of demand deposit wherefrom withdrawals are allowed any number of times depending upon the balance inn the account or to a particular agreed amount and will also include other deposit accounts which are neither Savings Deposit nor Term Deposit.

Opening of the Account and terms for Acceptance of Deposits:-

• Deposits would be accepted from individual/s having the capacity to contract after following the due diligence process and the prospective clients establishing the identity as per the KYC (Know Your Customer) Norms.
  
  

• Due diligence process, while opening deposit account will involve satisfying about the identity of the person, verification of address, satisfying about his occupation and source of income etc. Obtaining introduction of the prospective depositor from a person acceptable to the Bank and obtaining recent photograph of the person/s opening/ operating the account are part of due diligence process.
  
  

• In addition to the due diligence requirements, under KYC norms the Bank is required by law to obtain Permanent Account Number (PAN) or General Index Register (GIR) Number or alternatively declaration in Form 60 or Form 61 as specified under the income Tax Act / Rules.
  
  

• Current Account/Term Deposits can be opened by individuals partnership firms / Private and Public Limited Companies / HUFs /Specified Associates / Societies / Trusts etc. satisfying the due diligence process and KYC Norms.
  
  

• Joint account opened by more than one individual can be operated by singe individual or by more than one individual jointly. The mandate for operating the account can be modified with the consent of all account holders. Joint account holders can give any of the following mandates for the disposal of balance in the above accounts:
  
  Either or Survivor : If the account is held by two individuals say, A & B while the operations can be made any one of them, in the event of death, the balance shall remain payable to survivor.
  
  Anyone or Survivor:- If the account is held by more than two individuals say A, B & C, while the operations can be done by any one of them individually, the final balance along with interest will be paid to the survivor/s on the death of account holder/s.
  
  Former or Survivor:- If the account is held by two individuals with the mandate as Former or Survivor, during the life of the Former (viz the person whose names appears first in the Account Opening Form) the former alone shall have the right to operate the account and in the event of the death of the former the amount shall be paid to the survivor. The former at his discretion can change the mandate whenever he chooses to do so.





• At the request of the account holder, Bank will register Power of Attorney given by the account holder authorizing another person to operate the account on his behalf.
  
  

• The Nomination facility is available for all deposit accounts and for Safe Deposit Lockers. Nomination can be made in favour of individual only. Nomination can also be made in favour of a minor. Nomination so made can be cancelled or changed by the account holder/s at any time. Bank recommends that all the depositors to avail the facility of Nomination.
  
  

• Where a nomination has been made in the prescribed manner and purports to confer on any person the right to receive the amount of deposit from the Bank (upon the death of the depositor) payment made to such nominees by the Bank shall constitute full discharge of the liabilities of the Bank.
  
  

• In the normal course the minimum period of deposits is 15 days and maximum period is 10 years. In case a single deposit is 15 lacs and more it could be accepted for a minimum of 7 days.
  
  

• The in respect of Non-Resident Term deposits is minimum period of acceptance shall be for 1 year and maximum period shall be less than five years in terms of the directives of RBI.

Minor's Accounts:-

• Accounts can be opened in the name of the minor by the natural guardian or by the guardian appointed by the Court.
  
  

• A minor would be considered having attained the age of majority and the capacity to contract on completion of the age of 18 in the normal course and on completion of age of 21 when the Court appoints the guardian.
  
  

• Minors who have completed the age of 10 and who can read and write can also open Savings Bank account in their name and operate the account themselves. However, the balances in such account should not exceed Rs.50000/-. There is no ceiling as to the amount for Term Deposits. Minor should come in person to the Bank for withdrawing cash from Savings Bank Account.

Accounts of Illiterate/Blind Person

The Bank may at its discretion open deposit accounts other than Current Accounts of illiterate person. The account of such person may be opened provided he/she calls on the Bank personally with a witness who is known to both the depositor and the Bank. Normally no cheque book facility is provided for such Savings Bank Account. At the time of withdrawal/ repayment of deposit amount and / or interest, the account holder should affix his/her thumb impression mark in the presence of the authorized officer who should verify the identity of the person. The Bank will explain the need for proper care and safe keeping of pass book etc., given to the account holder. The official of the Bank would explain the terms and conditions governing the account of illiterate/blind person to them before opening of such account. All other conditions for opening of the account including providing proof of address, giving passport size of photograph, establishing of identity etc. and observance of KYC norms would remain unchanged.

Addition or Deletion of the Names of Joint Account Holders

The Bank may at the request of all the joint account holders allow addition/ deletion of name/s of joint account holder/s if the circumstances sp warrant or allow an individual depositor to add the name of another person as a joint holder.

Customer Information

The information collected from the customer shall not be used for cross selling. If the bank proposes to use such information, it shall be strictly with the consent of the account holder.

Secrecy of Accounts

The Bank shall not disclose details / particulars of the customer's account to a third person or party without the expressed or implied consent from the customer. However, there are some exceptions viz disclosure of information under compulsion of law, where there is a duty to public to disclose and where interest of the Bank requires disclosure.

Conversion of deposit scheme

The Bank, on a request from the depositor, shall allow conversion of a term deposit/recurring deposit to enable the depositor to immediately reinvest the amount lying in the aforesaid deposit in another term deposit. The Bank shall pay the appropriate rate of interest on the original deposit without any penalty taking in to account the period for which the deposit has run provided that the deposit remains with the bank after reinvestment for a period longer than the remaining period of original contract.

Premature Extenstion of deposits

Requests from the existing depositors for extension of the period of maturity would be accepted by treating the original deposit as paid before maturity but without the penalty provided that the deposit in question continues to be held with the Bank for a period longer than the remaining period of the original contract.

Transfer of deposits from one branch to another:

Request for transfer of a deposit from one branch of the Bank to another is accepted without any loss of interest to the depositor provided that such request is submitted in writing to the Branch along with the original deposit receipt.

Payment of Interest and Other general Information

• Bank shall pay interest on deposits as determined from time to time which rates depends on market conditions, RBI directives and Bank's Policy. The rate of interest on deposits for the various periods would be displayed by the branches in their notice board and would also be available in the website www.bharatoverseasbank.com
  
  

• In respect of Savings Bank accounts current interest rate @ 3.5 p.a would be credited half yearly during October and April every year.
  
  

• The minimum daily closing balance between 10th and the end of the month is taken for calculation of interest on Savings Bank Accounts.
  
  

• For Term deposits exceeding 90 days unless it is otherwise requested, interest would be paid quarterly rest
  
  

• Where there is a request for payment of Monthly Interest, the Bank would pay the discounted value of the quarterly interest.
  
  

• For FCNR Deposits interest shall be paid half-yearly.
  
  

• No interest is paid on Current Accounts
  
  

• Senior Citizen (who have completed 60 years ) would get additional interest of 0.5% p.a for deposit 1 year and above. The benefit of additional interest provided for deposits of 100 lacs and above will not be applicable to them.
  
  

• For NRE Term Deposits interest rates are fixed as per RBI directives based on the LIBOR/ SWAP rates prevailing on the last working day of the previous month for the corresponding maturity period.
  
  

• Interest Rates for NRE Savings account is fixed based on LIBOR/SWAP rates.
  
  

• NRE deposit should be held jointly with non-resident only.
  
  

• In case the day on which the deposit matures happens to be a public holiday under the Negotiable Instruments Act, the payment would considered to be due on the succeeding working day.
  
  

• The bank may at the request of all the joint account holders allow the addition or deletion of name/s of joint account holder/s. However, the amount and duration of original deposit would undergo no change.
  
  

• As Term Deposits is a Contract for depositing the monies for a particular period/date, it is left to the discretion of the Bank to allow loan against the deposits. Generally, Bank allows 85% of deposits as Loan.
  
  

• Interest @1% above the deposit rate in case it is a loan account and 1.5% in case it is a C/C against deposit would be charged.
  
  

• The schedule showing the prescribed minimum balances to be maintained in Current/Savings Bank account and the charges the bank would levy for non-maintenance together with the circumstances the Bank would levy charges are given in Annexure I & II, which are decided by the Bank to time to time.

Pre-matured Closure of Deposits

• Since fixed deposits are, as per contract, payable only after specific term, request for foreclosure from the customer shall be permitted only at the option of the Bank.
  
  

• In case of pre-matured closure of deposits, interest at rates as applicable for the period the deposit has run less 1% would be paid
  
  

• However, no interest shall be paid for deposits of less than Rs.15 lacs and has not completed 15 days. In case of deposits of Rs.15 lacs and above no interest shall be paid if it has not completed 7 days.

Interest on Overdue deposits

If the depositor has not claimed payment of deposits on the date of maturity it is considered as Overdue deposits and following shall be the policy of the Bank as to payment of interest on overdue deposits.

1. In case the repayment of deposit is without any renewal, no interest would be paid for the overdue period.
   
   

2. In case renewal is sought for within 15 days (both days inclusive), appropriate rate of interest as applicable on the date of maturity for the period sought to be renewed would be permitted.
   
   

3. In case the overdue period exceeds 15 days (both the days inclusive) interest as applicable for Savings Bank Account would be paid for the overdue period. The request for renewal would be treated as a fresh request and appropriate rate as applicable on the date of such request would be allowed.

Deduction of Tax At Source (TDS)

In terms of Income Tax Regulations, Bank would deduct tax at source when the payment of interest exceeds Rs. 5000/- per year. However, in event of submission of Form 15 H (prescribed by Income Tax Dept ) by individual depositor and the aggregate of interest paid/payable by a branch of the Bank during a financial year does not exceed Rs.50000/- deduction of tax at source will not be made.

Settlement of dues to Deceased Deposit Account

1. If the depositor has registered nomination with the Bank - the balance outstanding in the account of the deceased depositor will be paid to the nominee after the Bank satisfies about the identity of the nominee, etc
   
   

2. The above procedure will be followed even in respect of a joint account where nomination is registered with the Bank.
   
   

3. In a joint account, when one of the joint account holders dies, the Bank is required to make payment jointly, to the legal heirs of the deceased person and the surviving depositors. However, if the joint account holders had given mandate for disposal of balance in the account in the forms such as Either or Survivor, former / later or survivor, anyone of the survivors or survivors, stc, the payment will be made as per mandate.
   
   

4. In the absence of nomination and when there are no disputes among the claimants, the Bank after fully satisfying itself and at its discretion will pay the amount outstanding in the account of deceased person against joint application and indemnity by all legal heirs or the person mandated by legal heirs to receive the payment on their behalf without insisting on legal documents up to the limit approved by the Bank. This is to ensure that the common small depositors are not put to hardship on account of delays in completing legal formalities.

Payment of Interest for deceased depositor's account

Following shall remain the policy for payment of Interest on the deposit account of deceased depositor

1. At the contracted rate on the date of maturity of deposits.
   
   

2. If the payment is claimed before the date of maturity, bank would pay appropriate interest rates as applicable for the period the deposit has run without any penalty.
   
   

3. In the event of death of the depositor before the date of maturity of the deposit and the amount of the deposit is claimed after the date of maturity, the bank would pay interest at the contracted rate till the date of maturity. From the date of maturity to the date of payment, the bank would pay simple interest at the applicable rate operative on the date of maturity, for the period for which the deposit remained with the bank beyond the date of maturity.
   
   

4. In case of death of the depositor after the date of maturity of the deposit, the bank would pay interest at savings deposit rate operative on the date of maturity from the date of maturity till the date of payment.

Redressal of Complaints and grievances

Depositors having any complaint /grievance with regard to the services rendered by the Bank has a right to approach authority(ies) designated by the Bank for handling customer complaint / grievance. The details of the internal set up for redressal of complaints / grievances will be displayed in the branch premises. The branch official shall provide all required information regarding procedure for lodging the complaint. In case the customer does not get response from the bank within 30 days from the date of complaint, or he is not satisfied with the response received from the Bank, he has a right to approach Banking ombudsman appointed by Reserve Bank of India.

Termination of Contract:

As the Bank is also a party to the contract of opening the account, where the Operations in Savings/Current accounts are not satisfactory, the Bank may decide to close the account and pay the balance in the account to the depositor after giving due notice. Few instances where the account can be treated as undesirable are frequent non-maintenance of minimum balance, number of operations are more and not commensurate with the balance maintained in S.B. account, cheques are being issued without adequate funds or arrangements to meet the cheque amount and the depositor is reported to be indulging in illegal or undesirable activity.

Transparency of Information

Bank's policy relating to opening and maintenance of deposit accounts and the various charges on such accounts and the revisions in such policy and the charge, will be informed to the depositors in the following manner

1. As the terms and conditions given in the account opening form and the brochure detailing the terms and conditions.
   
   

2. In case of revision of the policy/requirements and the revised charges would be displayed in the Notice Board/prominent place in the branch.
   
   

3. Press/Media wherever necessary and Banks web-site www.bharatoverseasbank.com would also carry the changes in the policy/requirement/charges if any.

Annexure I
Required Minimum Balance for Current and Savings Accounts

In Recurring deposits Minimum monthly installment of Rs.50/- is accepted.@ Ascertain applicable charges from the branches concerned with whom the account is held.

• For transfer within the same Branch a/cs: FREE
• For remittances outward: Remittance charges as per tariff Rs10+ postages.

• Remittance to own Branches: FREE
• To Other Banks: As per tariff for DD/Bankers cheque

• For a period of 6 months if the cheque is dated Rs.
• Rs.20/- if the cheque is undated

1. Up to Rs.1000 Rs.25/-
2. Above Rs.1000 up to Rs.10000: Rs50/-
3. Above Rs.10000 up to Rs. 1 lac :Rs.100
4. Above Rs. 1 lac Rs.500/-