New RBI bank locker rules; 100 times the locker rent as penalty

Reserve Bank of India (RBI) has revised instructions for opening and maintaining bank lockers in banks through a notification issued on 18th August, 2021 which will come into effect from January 1,2022.
RBI has been facing lots of customer grievances in respect of bank lockers, feedback from banks which has compelled them to come up with these new guidelines. Let’s look at some of the most important points which really impact you:

• RBI has instructed all bank boards to frame an agreement for safe deposit lockers based on a model locker agreement to be framed by Indian Banks Association (IBA), with a direction to maintain a branch-wise list of vacant lockers as well as a wait-list for the purpose of allotment of lockers and ensure transparency in allotment of lockers.

• Further, regarding payment of locker rent, banks are allowed to obtain a Term Deposit, at the time of allotment, which would cover three years’ rent and the charges for breaking open the locker in case of such eventuality. However, shall not insist on such Term Deposits from the existing locker holders or those who have satisfactory operative account.

So if locker rent is Rs 4,000, the FD – they can ask you shall be for Rs 12,000 + some more charges like Rs 500-1000. So in total, it shall surely not cross 4 times the rent in any situation. But If the bank official asks you to create an FD for 2-3 lacs or forces you to buy any kind of insurance policy, then please tell them you are aware of rules and you will complain to RBI on this.

• If there is any loss of lockers content due to bank negligence or irresponsible behavior, then bank locker holders will get 100 times of locker rent as compensation. So if the yearly rent of the locker is Rs 4,000, then the compensation will be Rs 4 lacs.

However, if locker rent is collected in advance, the proportionate amount of advance rent collected shall be refunded to the customer in case of surrender of a locker by such customer. Even customers not having any banking relationship with the bank may also be given the facilities of safe deposit locker/safe custody article.

• Locker holder will get an email and SMS notification on the same day when the locker is accessed. This will help if there is any kind of fraud or unauthorized access (like someone from your family opens the locker without telling you)

• Banks will have to install CCTV to monitor the common areas and doors from where entry and exits happen inside the locker room. This CCTV footage has to be stored for the last 180 days.

• Now each locker application has to be duly acknowledged and a waitlist number has to be given to the customer. That waitlist number has to also get displayed in banks along with the number of vacant lockers. This is to ensure transparency. Right now the things are very opaque and customers don’t get enough information and clarity about their locker applications

The revised instructions will be applicable from 1st January, 2022 (except where otherwise specified) and be applicable to both new and existing safe deposit lockers and the safe custody of articles facility with the banks.

(The author is a Chartered Accountant and qualified professional advising on wealth management; views expressed are personal)