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Account Operations

Bankers Quotient

Recap of Negotiable
Instruments
Promissory Note
Bills of exchange
Cheques
Characteristics and features of NI
Endorsements
Crossings
Material alterations and Payment of cheque
Protection to paying & collecting Banker

List activities
that you
have seen
have heard
@ branches

Stop Payment
Customer can stop payment of a cheque ( single or
multiple)
Written request specify account number, cheque
number and reason for stopping the payment
Verification of signature
Check whether it is already paid
If not, then accept & stop payment
Acknowledgement to customer

Requests
Transfer of account
Within city or within country
Open a/c where desired and
transfer money & close old
account OR direct transfer which is
done by bank
Customer gets new account
number and new cheque book
Process differs from bank to bank

Requests
Addition of name Or deletion of name
Reconfiguration after death or one or more
holders
Specific requests

Aspects of addition of names

Resident applicants cannot be added to non


resident accounts as holders (NRE,FCNR,RFC)
Can be added for NRO accounts as second
holders
Cannot be added for loan accounts
No attachments or freeze should be there in
existing accounts

Process to add names

Requests

Process to delete names


Request letter from existing holders
Applicant whose name is to be deleted to surrender his/her ATM/debit card
Customers to surrender cheque book
Any cheques issued by old holders would
not be honoured for payments

Requests
Closure of account
At customers request
At Banks instance

Banks can close accounts of undesirable


customer

Too many cheque bounced insufficient balances


Frequent stop payment
Cheque deposited returned often
Guilty of cheating/forgery
Customers manner detrimental to bank

List
Some Special events
which happen
@ home

Special Requests & other


requests

Issue passbook/statements
Issue checkbook/cards
Dormant account

Requests from police/courts and IT department


Garnishee orders court
Attachment orders income tax authorities
Death of a customer

Issue of cheque book, passbook,


statement and other security items
Written request or the designated format from the bank duly
filled up by customer
Signature verified with the available records
Security items issued with additional verification of identity
proof
Passbook updation is a regular request
Statement sent by bank periodically only additional
requests need checking to ensure information is not provided
to any one other than holder

Suspicious situations
Large amounts Transactions
Transactions not making economic
sense
Inconsistent with customers stated
business
Avoidance of reporting
Unusual activities
Customer refusing or providing
insufficient information
Bank employees account

Reca
p of
AML

Other operations

Dormant accounts
No operations customer induced 24 months
treated as dormant
No operation without customers fresh mandate
allowed
Protection to banks & customers
Fraud
Anti money laundering purpose
Pass cheques post confirmation with customers ( oral or
written depending upon banks)

Requests from various


authorities
Banker obligation to disclose when
information is sought by police, IT
authorities etc
Any replies to be sent in consultation
with the controlling authorities
Not prudent to simply refuse or quote
instructions

Garnishee Orders
Recap Order nisi and order absolute
Banker customer relationship suspended
Directs bank to stop payment out of this account
On receipt recover any dues and then freeze the
remaining amount
Customer informed of receipt of order
Banks reply provided to court and post that order
absolute is issued
Bank needs to remit the frozen amount in entirety

WHERE CAN GARNISHEE ORDER


BE APPLICABLE AND WHERE NOT

Income Tax attachment


order

Sec 226 of IT Act 1961

Credit balance attached


Any deposits due and payable
Debts due but not payable ( FDs which
are to mature)
Any amount received subsequently
Balance of other joint accounts
Funds of deceased/insolvent customers

Action to be taken
Customer to be informed about notice
Amounts due to be recovered
Available balance to be remitted to IT
department, customer again informed
If not done bank shall be deemed to be an
assessee in default and IT may take action
to recover it from Bank

Death of customer
Operations stopped cheques cannot be
honoured
If nomination is available Nominee to be
paid letter of Request and proof of
identity
If there is a will payment is to the legal
heirs letter of request, probated Will, proof
of identity
Intestate No will Successors letter of
request, succession certificate from court,
proof of identity

Death of customer
If the accounts are joint ERS or ANY or survivor
Paid to survivors
If it was Joint paid to survivor along with
successors of the deceased holder
Proprietory Account treated as a single account
Partnership Account partnership dissolved
unless deed states otherwise
Dissolved jointly paid to surviving partners
Not dissolved new firm constituted and balance
transferred

Death of customer
For entities companies, HUF,
Trust etc

Remaining members of board, company,


management can continue operation
Appoint new member and add him as
authorized signatory
Trusts- Trust deed reference to continue
operations
HUF next senior co-parcener will
continue operations
Executors administrators etc appointed
by court and hence orders from court
needed to operate

THANK YOU