Banks get time till December-end to execute revised agreement with locker holders

The Reserve Bank of India (RBI) seal is pictured on a gate outside the RBI headquarters in Mumbai.
| Photo Credit: Reuters

The RBI on January 23, 2023 extended the time till December-end for banks to enter into revised agreements with safe deposit locker holders as a large number of customers are yet to do so.

In August, 2021 the Reserve Bank of India (RBI) had asked banks to enter into revised agreements with the existing locker holders by January 1, 2023 in view of various developments in the area of banking and technology, nature of consumer grievances and also the feedback received.

“However, it has come to the notice of RBI that a large number of customers are yet to sign the revised agreement.

“In many cases, the banks are yet to inform the customers about the need to do so before the stipulated date (January 1, 2023),” the central bank said in a statement while extending the deadline for banks to complete the process of renewal of agreements for the existing safe deposit lockers in a phased manner by December 31, 2023.

Banks have been asked to notify all their customers of the revised requirements by April 30, 2023 and ensure that at least 50 per cent and 75 per cent of their existing customers have executed the revised agreements by June 30 and September 30, 2023, respectively.

Banks also have to facilitate execution of the fresh/supplementary stamped agreements with their customers by taking measures such as arranging stamp papers, electronic execution of agreement, e-stamping, and providing a copy of the executed agreement to the customer.

The RBI also said in cases where operations in lockers have been frozen for non-execution of agreement by January 1, 2023, “the same shall be unfrozen with immediate effect”.

The August 2021 guidelines pertain to customer due diligence, model locker agreement, locker rent, security of strong rooms, and attachment and recovery of contents in a locker and the articles by any law enforcement authority, among others.

The RBI further said there is a need for revision in the Model Agreement drafted by the Indian Banks’ Association (IBA) to fully comply with the revised instructions.

“IBA is being advised separately to review and revise the Model Agreement to ensure that it complies with the requirements of circular dated August 18, 2021 and circulate a revised version to all banks by February 28, 2023,” it said in a circular.