Kathmandu. In India, children above the age of 10 can now open and operate savings or fixed deposit accounts on their own. For this, the Reserve Bank of India (RBI) gave permission to the banks. However, banks can set conditions for this as per their risk management policy.
The RBI has asked banks to frame their policies or change the existing rules as per these new rules by July 1. Until now, children of any age could open savings or fixed deposit accounts through their parents or legal guardians. But earlier, parents used to run them.
Children aged 10 years and above will be able to operate their own accounts. But banks will set some limits according to their rules, such as how much money can be deposited or withdrawn. How much money can be withdrawn at a time?
Banks can provide facilities like internet banking, ATM/debit card and cheque book to children. But it will depend on their risk.
Once the child is 18 years old, the bank will have to take a new signature from him. If the account was operated by a parent, the balance would be confirmed. Apart from this, the account holder will also be informed about the new rules.
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A bank account or fixed deposit account is controlled by the parents and the child’s name is added as a co-account holder. At the age of 18 years or above, a bank account or fixed deposit account can be transferred completely to his/her name. Some banks still offer the facility to open special bank account schemes like SBI First Step Account or HDFC Kids Advantage Account. Children above 10 years of age can open and operate their own bank accounts.
