Description
explains the different types of accounts in the bank for individuals, company and partnership firms.
?
Which are types of Deposits?
?
Which are types of Deposits?
? Current Deposits – payable on demand ? Savings Deposits – payable on demand ? Time Deposits – payable after certain time mutually agreed upon
?
What Purpose?
?
Interest?
?
Minimum balance?
?
Does Bank levy any charges?
?
Any restriction on number of transaction?
?
Any restriction on type of customer?
?
Purpose?
?
Interest?
?
Minimum balance?
?
Any restriction on number of transaction?
?
Any restriction on type of customer?
?
Repayable?
?
Interest?
?
Can accept periods exceeding 10 years?
?
Various types of customer are:
? ? ? ? ? ? ? ? ? Individual HUF or Joint Hindu families Firms Trusts Companies Clubs & Associations Executors & Administrators Official Liquidators Corporate Societies
?
Banker – customer relationship – contractual – therefore
? Competent to contract
?
Banker – customer relationship – contractual – therefore
? Obtain accounting opening form
?
Banker – customer relationship – contractual – therefore
? Specimen signature
?
Banker – customer relationship – contractual – therefore
? Issue cheque book / pay-in slips
?
Banker – customer relationship – contractual – therefore
? KYC – photographs/ identity proof/ proof of residence
?
Why should the account opener be properly introduced?
?
Why should the account opener be properly introduced?
? To identify the person
?
Why should the account opener be properly introduced?
? To obtain legal protection under Sec 131 of NI Act – not liable for negligence
?
Why should the account opener be properly introduced?
? Precaution against fraud – undesirable persons
?
Why should the account opener be properly introduced?
? Safeguard against Inadvertent overdraft
?
Why should the account opener be properly introduced?
? Enquiries about the customer
?
Bank accepts introduction from?
?
Bank accepts introduction from?
? An account holder ? Bank employee ? Locally well-known person ? Another Bank Should seek information – period for the customer is known
?
? ?
?
Account to be opened with cash Banker not concerned with the title of money deposited Mandate, if any
?
What are special precautions to be taken for the following accounts:
? ? ? ? ? ? ? ? Minors Lunatics Drunkards Insolvents Married Woman Illiterate Person Blind Person Liquidator/ Receiver/ Assignee
? ? ? ? ?
Contractual relationship stands canceled Obtain copy of death certificate Copy of will, after probation, paid to the executor or administrator Absence of will –legal heirs – after obtaining succession certificate from court Banks may waive succession certificate condition – if amount is small – only a stamped indemnity along with 2 sureties
? ?
Opened by 2 or more persons Opening account form – Operations may be
? ? ? ?
? signed by all account holders ? should indicate how it would be operated
?
Both jointly or by survivor Both jointly Either or survivor Former or Survivor
?
More than 2 –
? All of them jointly or survivors jointly or last survivor ? Any one of them or by more than one of them jointly or by one or more survivors or by the last survivor ? In absence of such instructions, then? ? Any changes in operations, how is it to be conveyed?
? ? ?
Insanity of joint account holder Insolvency of a joint account holder Death of a joint holder
?
Note on Opening, Closing and handling of Accounts in the name of Joint Hindu families
?
What is partnership?
?
? ?
?
Sec 4 of Indian Partnership Act – a relation subsisting between persons who have agreed to share profits of business carried on by all or any of them acting for all. How can the Agreement be? Firm doing business of banking, how many partners are allowed? For other types how many partners are allowed?
?
?
?
Under law, partnership is not an entity separate from its members All partners are jointly and severally liable for acts done by and on behalf of the firm in the normal course of the business Every member has the right to bind the firm by his own actions, working on behalf of the firm.
?
If partnership is not registered, what is the disadvantage?
?
? ? ? ?
In the firm’s name – Sec 19(2)(b) denies a partner authority to open a bank account on behalf of the firm in his own name Form signed by all partners Letter signed by all partners mentioning nature of business, names & addresses of all partners Letter should declare themselves as partners Give an undertaking – jointly & severally liable for debts of the firm
?
Clear instructions on the operation of the account
?
?
If given this no dormant partner can evade his lability and the banker is not put the trouble of proving the interest of all partners of the firm Can bank be instructed to authorise outside party to operate the account?
? Names of authorized persons ? Authority – power to draw, endorse & accept bills, Mortgage, Sell property
?
Operation of Account
? Should sign on behalf of firm ? Any partner has right to stop payment ? Any dispute on operation of account by any partner – stop all transaction ? Guarantee – signed by all partners ? Retirement of partner ? Death of partner ? Insolvency of any account ? Partnership account & partners individual account
?
Operation of Account
? Position of a Minor – Section 30 of the Indian Partnership Act – wherein a minor can be admitted to the partnership ? Become a partner and act as an agent on behalf on behalf of other partners or the firm ? Is minor liable personally for the debts of the company?
? ? ? ? ?
Company is just like a person – corporate person Public Limited Company – how many members? Private Limited Company - how many members? Private limited Banking Company - how many members? Government Companies
?
Banker should ask for which documents:
?
Banker should:
? Copies of MoA & AoA ? Certificate of Incorporation or Certificate of commencement of business ? Certified copy of resolution ? Opening form to signed by authorized persons ? Specimen signatures ? List of directors ? Is Introduction necessary?
? ? ?
Issue of cheque by company Death by director Advances to companies:
? Purpose within the scope of ________ ? _____ should specifically empower company to borrow ? Sec 293(1)(d) Cos Act – borrowing limit – ? - does this apply to private limited companies? ? Charges to registered with ROC within 30 days – Assignment – which charges need to be registered ? Cannot advance to companies - director of bank ? Winding up
?
Note on Opening, Closing and handling of following Accounts
? ? ? ? ? ? ? Club & Association Account Trust Accounts Executors & Administrators’ Accounts Liquidator’s Account Cooperative Societies’ Account Government Department Accounts Pension Accounts
? ?
Who is an NRI? An Individual being a citizen of India or person of Indian origin residing outside India
?
Who is a of Indian Origin?
?
? ?
?
He or either his parents or any of his grandparents was a citizen of India – Citizenship Act 1955 He, at any time held an Indian passport Nationals of Bangladesh or Pakistan shall not be deemed to be of Indian origin A spouse of a person of Indian origin shall also be deemed to be of Indian origin. Exception?
?
What are the categories of NRIs?
?
?
Those who stay abroad for employment or for carrying out business or vocation for any other purpose indicating an indefinite stay outside India Indian citizens working abroad
?
Account types
? Ordinary Non-resident Rupee Accounts (NRO) ? Non-Resident (External) Rupee Accounts (NRE) ? Non-resident (Non-Repatriable) Rupee Deposits (NRNR) ? Foreign Currency (Non-resident) Accounts (Bank) Schemes (FCNR(B))
?
?
NRO, NRE – current, savings, recurring deposits or term deposits NRNR & FCNR (B) – term deposits
? ?
?
Opening & conduct of NRI Accounts Loans & Advances to NRIs against Security Deposits Premature withdrawal under NRE/ FCNR (B) Accounts and the Tax implications
?
Who/ How can the account be closed?
?
Banks instance
?
Banks instance
? Habituated to draw against insufficient balance ? Frequently countermanding payment of cheques ? Cheques tendered to his account are often dishonoured ? Guilty of making forgery on cheques ? Detrimental to bank’s prestige ? Cause nuisance and inconvenience to the bank
? ?
Notice When the account is proposed to be closed at the instance of the bank – they should give proper notice to the client – why?
? ?
?
Notice When the account is proposed to be closed at the instance of the bank – they should give proper notice to the client – why? If the bank does not give sufficient notice, it may lead to legal complications for the bank
?
Customers Instance
?
Customers Instance
? Changes his place of business/ residence ? Better facilities from another Bank ? Not satisfied with service rendered
?
Not bound to give reasons
? ? ? ? ?
Customers death Customer insanity Customer insolvent Change in constitution of firm – due to death Garnishee Order
?
Garnishee Order
? If Garnishee order is issued by _______ at the request of __________ ? The bank should stop payment of cheques
?
Assignment: If the Garnishee is of specific amount, then what should the Banker do?
?
?
Procedure Before closing the account:
? Customer’s letter – request for closure ? Ensure that no other dues are outstanding ? Customer to draw a check for balance outstanding, with interest if applicable ? Practice in certain Banks – obtain “nil” confirmation ? All unused cheques to returned with requisition slip therein ? Account squared up – nil balance ? Suitable noting in the ledger index and general index is made
?
Bank Passbook & its importance
doc_914752801.pptx
explains the different types of accounts in the bank for individuals, company and partnership firms.
?
Which are types of Deposits?
?
Which are types of Deposits?
? Current Deposits – payable on demand ? Savings Deposits – payable on demand ? Time Deposits – payable after certain time mutually agreed upon
?
What Purpose?
?
Interest?
?
Minimum balance?
?
Does Bank levy any charges?
?
Any restriction on number of transaction?
?
Any restriction on type of customer?
?
Purpose?
?
Interest?
?
Minimum balance?
?
Any restriction on number of transaction?
?
Any restriction on type of customer?
?
Repayable?
?
Interest?
?
Can accept periods exceeding 10 years?
?
Various types of customer are:
? ? ? ? ? ? ? ? ? Individual HUF or Joint Hindu families Firms Trusts Companies Clubs & Associations Executors & Administrators Official Liquidators Corporate Societies
?
Banker – customer relationship – contractual – therefore
? Competent to contract
?
Banker – customer relationship – contractual – therefore
? Obtain accounting opening form
?
Banker – customer relationship – contractual – therefore
? Specimen signature
?
Banker – customer relationship – contractual – therefore
? Issue cheque book / pay-in slips
?
Banker – customer relationship – contractual – therefore
? KYC – photographs/ identity proof/ proof of residence
?
Why should the account opener be properly introduced?
?
Why should the account opener be properly introduced?
? To identify the person
?
Why should the account opener be properly introduced?
? To obtain legal protection under Sec 131 of NI Act – not liable for negligence
?
Why should the account opener be properly introduced?
? Precaution against fraud – undesirable persons
?
Why should the account opener be properly introduced?
? Safeguard against Inadvertent overdraft
?
Why should the account opener be properly introduced?
? Enquiries about the customer
?
Bank accepts introduction from?
?
Bank accepts introduction from?
? An account holder ? Bank employee ? Locally well-known person ? Another Bank Should seek information – period for the customer is known
?
? ?
?
Account to be opened with cash Banker not concerned with the title of money deposited Mandate, if any
?
What are special precautions to be taken for the following accounts:
? ? ? ? ? ? ? ? Minors Lunatics Drunkards Insolvents Married Woman Illiterate Person Blind Person Liquidator/ Receiver/ Assignee
? ? ? ? ?
Contractual relationship stands canceled Obtain copy of death certificate Copy of will, after probation, paid to the executor or administrator Absence of will –legal heirs – after obtaining succession certificate from court Banks may waive succession certificate condition – if amount is small – only a stamped indemnity along with 2 sureties
? ?
Opened by 2 or more persons Opening account form – Operations may be
? ? ? ?
? signed by all account holders ? should indicate how it would be operated
?
Both jointly or by survivor Both jointly Either or survivor Former or Survivor
?
More than 2 –
? All of them jointly or survivors jointly or last survivor ? Any one of them or by more than one of them jointly or by one or more survivors or by the last survivor ? In absence of such instructions, then? ? Any changes in operations, how is it to be conveyed?
? ? ?
Insanity of joint account holder Insolvency of a joint account holder Death of a joint holder
?
Note on Opening, Closing and handling of Accounts in the name of Joint Hindu families
?
What is partnership?
?
? ?
?
Sec 4 of Indian Partnership Act – a relation subsisting between persons who have agreed to share profits of business carried on by all or any of them acting for all. How can the Agreement be? Firm doing business of banking, how many partners are allowed? For other types how many partners are allowed?
?
?
?
Under law, partnership is not an entity separate from its members All partners are jointly and severally liable for acts done by and on behalf of the firm in the normal course of the business Every member has the right to bind the firm by his own actions, working on behalf of the firm.
?
If partnership is not registered, what is the disadvantage?
?
? ? ? ?
In the firm’s name – Sec 19(2)(b) denies a partner authority to open a bank account on behalf of the firm in his own name Form signed by all partners Letter signed by all partners mentioning nature of business, names & addresses of all partners Letter should declare themselves as partners Give an undertaking – jointly & severally liable for debts of the firm
?
Clear instructions on the operation of the account
?
?
If given this no dormant partner can evade his lability and the banker is not put the trouble of proving the interest of all partners of the firm Can bank be instructed to authorise outside party to operate the account?
? Names of authorized persons ? Authority – power to draw, endorse & accept bills, Mortgage, Sell property
?
Operation of Account
? Should sign on behalf of firm ? Any partner has right to stop payment ? Any dispute on operation of account by any partner – stop all transaction ? Guarantee – signed by all partners ? Retirement of partner ? Death of partner ? Insolvency of any account ? Partnership account & partners individual account
?
Operation of Account
? Position of a Minor – Section 30 of the Indian Partnership Act – wherein a minor can be admitted to the partnership ? Become a partner and act as an agent on behalf on behalf of other partners or the firm ? Is minor liable personally for the debts of the company?
? ? ? ? ?
Company is just like a person – corporate person Public Limited Company – how many members? Private Limited Company - how many members? Private limited Banking Company - how many members? Government Companies
?
Banker should ask for which documents:
?
Banker should:
? Copies of MoA & AoA ? Certificate of Incorporation or Certificate of commencement of business ? Certified copy of resolution ? Opening form to signed by authorized persons ? Specimen signatures ? List of directors ? Is Introduction necessary?
? ? ?
Issue of cheque by company Death by director Advances to companies:
? Purpose within the scope of ________ ? _____ should specifically empower company to borrow ? Sec 293(1)(d) Cos Act – borrowing limit – ? - does this apply to private limited companies? ? Charges to registered with ROC within 30 days – Assignment – which charges need to be registered ? Cannot advance to companies - director of bank ? Winding up
?
Note on Opening, Closing and handling of following Accounts
? ? ? ? ? ? ? Club & Association Account Trust Accounts Executors & Administrators’ Accounts Liquidator’s Account Cooperative Societies’ Account Government Department Accounts Pension Accounts
? ?
Who is an NRI? An Individual being a citizen of India or person of Indian origin residing outside India
?
Who is a of Indian Origin?
?
? ?
?
He or either his parents or any of his grandparents was a citizen of India – Citizenship Act 1955 He, at any time held an Indian passport Nationals of Bangladesh or Pakistan shall not be deemed to be of Indian origin A spouse of a person of Indian origin shall also be deemed to be of Indian origin. Exception?
?
What are the categories of NRIs?
?
?
Those who stay abroad for employment or for carrying out business or vocation for any other purpose indicating an indefinite stay outside India Indian citizens working abroad
?
Account types
? Ordinary Non-resident Rupee Accounts (NRO) ? Non-Resident (External) Rupee Accounts (NRE) ? Non-resident (Non-Repatriable) Rupee Deposits (NRNR) ? Foreign Currency (Non-resident) Accounts (Bank) Schemes (FCNR(B))
?
?
NRO, NRE – current, savings, recurring deposits or term deposits NRNR & FCNR (B) – term deposits
? ?
?
Opening & conduct of NRI Accounts Loans & Advances to NRIs against Security Deposits Premature withdrawal under NRE/ FCNR (B) Accounts and the Tax implications
?
Who/ How can the account be closed?
?
Banks instance
?
Banks instance
? Habituated to draw against insufficient balance ? Frequently countermanding payment of cheques ? Cheques tendered to his account are often dishonoured ? Guilty of making forgery on cheques ? Detrimental to bank’s prestige ? Cause nuisance and inconvenience to the bank
? ?
Notice When the account is proposed to be closed at the instance of the bank – they should give proper notice to the client – why?
? ?
?
Notice When the account is proposed to be closed at the instance of the bank – they should give proper notice to the client – why? If the bank does not give sufficient notice, it may lead to legal complications for the bank
?
Customers Instance
?
Customers Instance
? Changes his place of business/ residence ? Better facilities from another Bank ? Not satisfied with service rendered
?
Not bound to give reasons
? ? ? ? ?
Customers death Customer insanity Customer insolvent Change in constitution of firm – due to death Garnishee Order
?
Garnishee Order
? If Garnishee order is issued by _______ at the request of __________ ? The bank should stop payment of cheques
?
Assignment: If the Garnishee is of specific amount, then what should the Banker do?
?
?
Procedure Before closing the account:
? Customer’s letter – request for closure ? Ensure that no other dues are outstanding ? Customer to draw a check for balance outstanding, with interest if applicable ? Practice in certain Banks – obtain “nil” confirmation ? All unused cheques to returned with requisition slip therein ? Account squared up – nil balance ? Suitable noting in the ledger index and general index is made
?
Bank Passbook & its importance
doc_914752801.pptx