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__________________________________________________________________________________________________________________िविनयमन^ िवभाग,^ क�द्र^ ीय^ काया�लय, 12वीं^ और^13 वीं^ मंिज़ल,^ शहीद^ भगत^ िसंह^ माग�,^ मुंबई^400001 Department of Regulation, Central Office, 12th & 13th Floor, Shahid Bhagat Singh Marg, Mumbai - 400001 Tel No: 22661602, 22705651, Fax No: 022-2270 5670, Email ID: [email protected]
RBI/2021-2022/
DOR.LEG.REC/40/09.07.005/2021-22 August 18, 2021
All Scheduled Commercial Banks (including RRBs) All Co-operative Banks All Small Finance Banks All Payments Banks All Local Area Banks
Madam/Sir,
Safe Deposit Locker/Safe Custody Article Facility provided by the banks - Revised Instructions
Please refer to the extant instructions issued to Regulated Entities (REs) by the Reserve Bank on the above subject. Taking into consideration the various developments in the area of banking and technology, nature of consumer grievances and also the feedback received from banks and Indian Banks’ Association (IBA), Reserve Bank of India (‘the Reserve Bank’) has reviewed the guidelines/instructions issued on the above subject. The review also takes into account, the principles enumerated by the Hon’ble Supreme Court in ‘Amitabha Dasgupta vs United Bank of India’, (Judgment dated February 19, 2021 in CA No. 3966 of 2010).
- Accordingly, in exercise of the powers conferred by Section 35A and Sections 45ZC to 45ZF of the Banking Regulation Act, 1949, read with Section 56 of the Act ibid and all other provisions of this Act or any other law enabling the Reserve Bank in this regard, the Reserve Bank being satisfied that it is necessary and expedient in public interest to do so, hereby issues the detailed revised instructions on the above subject. The revised instructions, attached as Annex to this circular, are issued in supersession of the earlier instructions issued by the Reserve Bank on the subject as listed in the Appendix. The banks are advised to frame their own Board approved policy/ operational guidelines in this regard taking into account the revised instructions.
- The revised instructions shall come into force with effect from January 1, 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.
Yours faithfully,
(Thomas Mathew) Chief General Manager
ANNEX Safe Deposit Locker / Safe Custody Article Facility- Revised Instructions (Circular No. DOR.LEG.REC/40/09.07.005/2021-22 dated August 18, 2021) INDEX
Para No.
Particulars Page No. PART I: Customer Due Diligence (CDD) for Lockers 1 Customer Due Diligence 2 PART II: Locker Allotment 2.1 Model Locker Agreement 3 2.2 Locker rent 3 PART III: Infrastructure and Security Standards 3.1 Security of the Strong Room/Vault 4 3.2 Locker Standards 4 PART IV: Locker Operations 4.1 Regular Operations by Customers 5 4.2 Internal Controls by banks 6 PART V: Nomination Facility and Settlement of Claims 5.1 Nomination Facility 7 5.2 Settlement of Claims in case of death of a Customer 7 5.3 Access to the articles in the safe deposit lockers/ return of safe custody articles
PART VI: Closure and Discharge of locker items 6.1 Discharge of locker contents at the request of customer 10 6.2 Attachment and recovery of contents in a Locker and the Articles in the safe custody of the bank by any Law Enforcement Authority
6.3 (^) Discharge of locker contents by banks due to non-payment of locker rent 11 6.4 (^) Discharge of locker contents if the locker remains inoperative for a long period of time
PART VII: Compensation Policy / Liability for Banks 7 Liability of banks 13 7.1 (^) Liability of banks arising from natural calamities like earthquake, flood, thunderstorm, lightning etc. or due to sole negligence of the customer
7.2 (^) Liability of banks arising from events like fire, theft, burglary, dacoity, robbery, building collapse or in case of fraud committed by the employees of the bank
PART VIII: Risk Management, Transparency and Customer Guidance 8.1 Branch Insurance Policy 14 8.2 Insurance of locker contents by the customer 14 8.3 (^) Customer guidance and publicity 14 8.4 Board approved policies and SOPs 15 Forms 16 Appendix 19
2.1 Model Locker Agreement
2.1.1 Banks shall have a Board approved agreement for safe deposit lockers. For this purpose, banks may adopt the model locker agreement to be framed by IBA. This agreement shall be in conformity with these revised instructions and the directions of the Hon’ble Supreme Court in this regard. Banks shall ensure that any unfair terms or conditions are not incorporated in their locker agreements. Further, the terms of the contract shall not be more onerous than required in ordinary course of business to safeguard the interests of the bank. Banks shall renew their locker agreements with existing locker customers by January 1, 2023.
2.1.2 At the time of allotment of the locker to a customer, the bank shall enter into an agreement with the customer to whom the locker facility is provided, on a paper duly stamped. A copy of the locker agreement in duplicate signed by both the parties shall be furnished to the locker- hirer to know his/her rights and responsibilities. Original Agreement shall be retained with the bank’s branch where the locker is situated.
2.2 Locker Rent
2.2.1 Banks may face potential situations where the locker-hirer neither operates the locker nor pays the rent. To ensure prompt 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. Banks, however, shall not insist on such Term Deposits from the existing locker holders or those who have satisfactory operative account. The packaging of allotment of locker facility with placement of term deposits beyond what is specifically permitted above will be considered as a restrictive practice.
2.2.2 If locker rent is collected in advance, in the event of surrender of a locker by a customer, the proportionate amount of advance rent collected shall be refunded to the customer.
2.2.3 If there is any event such as merger / closure / shifting of branch warranting physical relocation of the lockers, the bank shall give public notice in two newspapers (including one local daily in vernacular language) in this regard and the customers shall be intimated at least two months in advance along with options for them to change or close the facility. In case of unplanned shifting due to natural calamities or any other such emergency situation, banks shall make efforts to intimate their customers suitably at the earliest.
PART III: Infrastructure and Security Standards
3.1 Security of the Strong Room/Vault
3.1.1 Banks shall take necessary steps to ensure that the area in which the locker facility is housed is properly secured to prevent criminal break-ins. The risks of accessibility of an allotted locker from any side without involvement of the locker-hirer concerned may be assessed and kept on record. Banks shall have a single defined point of entry and exit to the locker room/vault. The place where the lockers are housed must be secured enough to protect against hazard of rain / flood water entering and damaging the lockers in contingent situations. The fire hazard risks of the area should also be assessed and minimized. The banks, as per their policy, shall conduct necessary engineering / safety verification regularly to identify the risks and carry out necessary rectification.
3.1.2 The area housing the lockers should remain adequately guarded at all times. The banks shall install Access Control System, if required as per their risk assessment, which would restrict any unauthorized entry and create digital record of access to locker room with time log. As per their internal security policy, banks may cover the entry and exit of the strong room and the common areas of operation under CCTV camera and preserve its recording for a period of not less than 180 days. In case any customer has complained to the bank that his/her locker is opened without his/her knowledge and authority, or any theft or security breach is noticed/observed, the bank shall preserve the CCTV recording till the police investigation is completed and the dispute is settled.
3.1.3 The security procedures shall be well-documented and the staff concerned shall be properly trained in the procedure. The internal auditors shall verify and report the compliance to ensure that the procedures are strictly adhered to.
3.2 Locker Standards
3.2.1 All the new mechanical lockers to be installed by the banks shall conform to basic standards / benchmarks for safety and security as prescribed by Bureau of Indian Standards (BIS) or any other enhanced industry standards applicable in this regard.
4.1.2 The bank’s officer authorizing the locker-hirer to access the locker, after unlocking the first key / password shall not remain present when the locker is opened by the locker-hirer. The banks shall ensure that there is adequate privacy to the locker-hirers in the operations when customers access the lockers at the same time.
4.1.3 Banks shall send an email and SMS alert to the registered email ID and mobile number of the customer before the end of the day as a positive confirmation intimating the date and time of the locker operation and the redressal mechanism available in case of unauthorized locker access.
4.2 Internal Controls by banks
4.2.1 There shall be a system of inter change of locks whenever the locker is surrendered by the hirer. The keys of vacant lockers shall be kept in sealed envelopes. The duplicate master keys shall be deposited with another branch of the bank. There shall be proper record of joint custody of master keys. Banks shall conduct surprise periodic verification of surrendered/vacant lockers and their keys by an officer of the bank who is not connected with their custody and proper record shall be maintained as a proof of such verification.
4.2.2 Banks shall ensure that the Locker Register and the Locker Key Register are maintained in CBS or any other computerized system compliant with the Cyber Security Framework issued by the Reserve Bank. The Locker Register shall be updated in case of any change in the allotment with complete audit trails.
4.2.3 The bank custodian shall check whether the lockers are properly closed post locker operation. If the same is not done, the lockers must be immediately closed, and the locker-hirer shall be promptly intimated through e-mail, if registered or through SMS, if mobile number is registered or through letter so that they may verify any resulting discrepancy in the contents of the locker. The bank custodian shall record the fact of not closing the locker properly in the register and its closure by the bank with the date and time. Further, the custodian of the locker room shall carry out a physical check of the locker room at the end of the day to ensure that lockers are properly closed, and that no person is inadvertently trapped in the locker room after banking hours.
PART V: Nomination Facility and Settlement of Claims
5.1 Nomination Facility
5.1.1 The banks shall offer nomination facility in case of safe deposit lockers and safe custody of articles, in accordance with the provisions of section 45-ZC to 45-ZF of the Banking Regulation Act, 1949 and Banking Companies (Nomination) Rules, 1985/Co-operative Banks (Nomination) Rules, 1985. In case the nominee is a minor, the same procedure as prescribed for the bank accounts shall be followed by the banks. A passport size photo of the nominee attested by the customer may be obtained from the customers, at his/her option and preserved in the records.
5.1.2 For the various Forms (Forms SC1, SC2 and SC3 for Articles left in Safe Custody and Forms SL1, SL1A, SL2, SL3 and SL3A for Safety Lockers) prescribed under Banking Companies (Nomination) Rules, 1985/Co-operative Banks (Nomination) Rules, 1985, only Thumb-impression(s) shall be required to be attested by two witnesses. Signatures of the account holders need not be attested by witnesses.
5.1.3 Banks shall have appropriate systems and procedures in place to register the nomination, cancellation and / or variation of the nomination, in their books, made by the locker hirers.
5.1.4 Banks shall devise a proper system of acknowledging the receipt of duly completed form of nomination, cancellation and / or variation of the nomination. Such acknowledgement shall be given to all the customers irrespective of whether the same is demanded by the customers or not.
5.2 Settlement of Claims in case of death of a Customer
5.2.1 Banks shall have a Board approved policy for settlement of claims. The policy shall be in conformity with the regulatory instructions and the Model Operational Procedure (MOP) for settlement of claims of the deceased constituents formulated by the IBA and in case of State and Central Co-operative Banks, MOP formulated by NABARD.
5.2.2 Banks shall have a Board approved policy for nomination and release of contents of safety lockers / safe custody article to the nominee and protection against notice of claims of other persons in accordance with the provisions of Sections 45 ZC to 45 ZF of the Banking Regulation Act, 1949 and the Banking Companies (Nomination) Rules, 1985/Co-operative Banks (Nomination) Rules, 1985 and the relevant provisions of Indian Contract Act and Indian Succession Act.
5.3.2 Banks shall, however, ensure the following before giving access to the contents to nominee / survivor:
(i) Exercise due care and caution in establishing the identity of the survivor(s) / nominee(s) and the fact of death of the locker hirer by obtaining appropriate documentary evidence; (ii) Make diligent effort to find out whether there is any order or direction from Courts/Forums restraining it from giving access to the locker of the deceased; and (iii) Make it clear to the survivor(s) / nominee(s) that access to articles in the locker / safe custody articles is given to them only as a trustee of the legal heirs of the deceased locker hirer i.e., such access given to them shall not affect the right or claim which any person may have against the survivor(s) / nominee(s) to whom the access is given.
Similar procedure shall be followed for return of articles placed in the safe custody of the bank.
5.3.3 The banks shall ensure that, the contents of locker, when sought to be removed on behalf of a minor nominee, are handed over to a person who is, in law, competent to receive the articles on behalf of such minor. Further, the banks shall prepare an inventory of the articles in the presence of two independent witnesses, one officer of the bank who is not associated with the locker facility or safe deposit of articles and the claimant (s), who may be a nominee or an individual receiving the articles, on behalf of a minor.
5.3.4 The bank shall obtain a separate statement from the nominee (claimant) or the person competent to receive articles on behalf of the minor, as the case may be, that all the contents in the locker or in the safe custody of the bank, as the case may be, are received and the locker is empty and they have no objection to allotment of the locker to any other customer as per norms.
5.3.5 While giving access to the survivor(s) / nominee(s) of the deceased locker hirer / depositor of the safe custody articles, banks may avoid insisting on the production of succession certificate, letter of administration or probate, etc., or obtain any bond of indemnity or surety from the survivor(s)/nominee(s), unless there is any discrepancy in nomination. In this regard, banks shall take note of our instructions under para 5.3.2.
5.3.6 In case where the deceased locker hirer had not made any nomination or where the joint hirers had not given any mandate that the access may be given to one or more of the survivors by a clear survivorship clause, banks shall adopt a Board approved policy to facilitate access to
legal heir(s) / legal representative of the deceased locker hirer. In this regard, banks shall take note of our instructions under para 5.3.2.
Similar procedure shall be followed for the articles under safe custody of the bank.
PART VI: Closure and Discharge of locker items
- This part refers to the breaking open of the locker in a manner other than through the normal access by the customer using her/his original key or password under any one of the following circumstances:
(i) if the hirer loses the key and requests for breaking open the locker at her /his cost; or
(ii) if the Government enforcement agencies have approached the bank with orders from the Court or appropriate competent authority to seize lockers and requested for access to the lockers; or
(iii) if the bank is of the view that there is a need to take back the locker as the locker hirer is not co-operating or not complying with the terms and conditions of the agreement.
Banks shall have a clear Board approved policy together with a Standard Operating Procedure (SOP) for breaking open the lockers for all possible situations keeping in view the relevant legal and contractual provisions.
6.1 Discharge of locker contents at the request of customer
6.1.1 If the key of the locker, supplied by bank is lost by the locker-hirer, the customer (locker hirer) shall notify the bank immediately. An undertaking may also be obtained from the customer that the key lost, if found in future, will be handed over to the bank. All charges for opening the locker, changing the lock and replacing the lost key may be recovered from the hirer. The charges applicable for replacement of lost keys / issue of new password shall be communicated to the locker hirer.
6.1.2 The opening of the locker has to be carried out by the bank or its authorized technician only after proper identification of the hirer, proper recording of the fact of loss and written authorization by the customer for breaking open the locker.
6.3.2 Before breaking open the locker, the bank shall give due notice to the locker-hirer through a letter and through email and SMS alert to the registered email id and mobile phone number. If the letter is returned undelivered or the locker-hirer is not traceable, the bank shall issue public notice in two newspaper dailies (one in English and another in local language) giving reasonable time to the locker-hirer or to any other person/s who has interest in the contents of locker to respond. The locker shall be broken open in the presence of an officer of the bank and two independent witnesses. In case of electronically operated lockers (including Smart Vaults), the use of ‘Vault Administrator’ password for opening of locker shall be assigned to a senior official and complete audit trail of access shall be preserved. Further, banks shall also record a video of the break open process together with inventory assessment and its safe keep and preserve the same so as to provide evidence in case of any dispute or Court case in future. Banks shall also ensure that the details of breaking open of locker is documented in CBS or any other computerized systems compliant with the Cyber Security Framework issued by RBI, apart from locker register. After breaking open of locker, the contents shall be kept in sealed envelope with detailed inventory inside fireproof safe in a tamper-proof way until customer claims it. A record of access to the fireproof safe shall invariably be maintained. While returning the contents of the locker, the bank shall obtain acknowledgement of the customer on the inventory list to avoid any dispute in future.
6.3.3 Banks shall ensure that the inventory prepared after breaking open of the locker and during settlement of claims, is in the appropriate forms as provided at the end of this circular or as near thereto as circumstances require. Further, banks shall not open sealed/closed packets left with them for safe custody or found in locker while releasing them to the nominee(s) and surviving locker hirers / depositor of safe custody article, unless required by law.
6.4 Discharge of locker contents if the locker remains inoperative for a long period of time
6.4.1 If the locker remains inoperative for a period of seven years and the locker-hirer cannot be located, even if rent is being paid regularly, the bank shall be at liberty to transfer the contents of the locker to their nominees/legal heir or dispose of the articles in a transparent manner, as the case may be. Before breaking open the locker, the bank shall follow the procedure as prescribed in paragraph 6.3.2 and 6.3.3 above. Banks shall ensure that the procedure to be followed by them for disposal of the articles left unclaimed for a reasonably long period of time as mentioned above is incorporated in their locker agreement.
6.4.2 The banks shall ensure that appropriate terms are inserted in the locker agreement executed with the customer specifying the position in case the locker is not in operation for long period. A clause may also be incorporated in the locker agreement to discharge the bank from liability in case the locker is not in operation and the locker is opened by the bank and contents are released as per law and as per the instructions issued by the Reserve Bank and the terms and conditions prescribed in the agreement.
PART VII: Compensation Policy / Liability for Banks
7. Liability of banks The banks shall put in place a detailed Board approved policy outlining the responsibility owed by them for any loss or damage to the contents of the lockers due to their negligence as banks owe a separate duty of care to exercise due diligence in maintaining and operating their locker or safety deposit systems. The duty of care includes ensuring proper functioning of the locker system, guarding against unauthorized access to the lockers and providing appropriate safeguards against theft and robbery. Further, banks shall adhere to the Master Directions on Frauds for reporting requirements about the instances of robberies, dacoities, thefts and burglaries.
7.1 Liability of banks arising from natural calamities like earthquake, flood, thunderstorm, lightning etc. or due to sole negligence of the customer
The bank shall not be liable for any damage and/or loss of contents of locker arising from natural calamities or Acts of God like earthquake, floods, lightning and thunderstorm or any act that is attributable to the sole fault or negligence of the customer. Banks shall, however, exercise appropriate care to their locker systems to protect their premises from such catastrophes.
7.2 Liability of banks arising from events like fire, theft, burglary, dacoity, robbery, building collapse or in case of fraud committed by the employees of the bank
It is the responsibility of banks to take all steps for the safety and security of the premises in which the safe deposit vaults are housed. It has the responsibility to ensure that incidents like fire, theft/ burglary/ robbery, dacoity, building collapse do not occur in the bank’s premises due to its own shortcomings, negligence and by any act of omission/commission. As banks cannot claim that they bear no liability towards their customers for loss of contents of the locker, in instances where loss of contents of locker are due to incidents mentioned above or attributable
8.4 Board approved policies and SOPs
Banks shall put in place a comprehensive revised Board approved policy and SOPs on safe deposit locker facility/safe custody article as per the revised instructions mentioned herein.
Forms Notification (DBOD.No.Leg.BC.38/C.233A-85 dated March 29, 1985) (UBD.BR.764/B.1-84/85 dated March 29, 1985)
In exercise of the powers conferred on the Reserve Bank of India by sub-section (3) of section 45ZC and sub-section (4) of section 45ZE of the Banking Regulation Act, 1949, read with Section 56 of the Act ibid (for co-operative banks) respectively, the Reserve Bank of India hereby directs that the inventory to be prepared before returning articles left in safe custody and the inventory to be prepared before permitting removal of the contents of a safety locker, shall respectively be in the appropriate Forms set out as enclosed or as near thereto as circumstances require.
Sd/-
A. GHOSH
Deputy Governor
Form of Inventory of articles left in safe custody with banking company (Section 45ZC (3) of the Banking Regulation Act, 1949)
The following inventory of articles left in safe custody with branch, by Shri/Smt. (deceased) under an agreement/receipt dated was taken on this, day of 20.
Sr. No. Description of Articles in Safe Custody
Other Identifying Particulars, if any
The above inventory was taken in the presence of :
- Shri/Smt. (Nominee) (Appointed on behalf of minor Nominee)^ Shri/Smt.
The above inventory was taken in the presence of:
- Shri/Smt. __________________________ (Nominee) ____________________ Address ___________________________ (Signature)
Or
- Shri/Smt. __________________________ (Nominee) ____________________ Address ___________________________ (Signature)
and
Shri/Smt. __________________________ ____________________ Address ___________________________ (Signature)
Shri/Smt. __________________________ ________________ Survivors of Address ___________________________ (Signature) joint hirers
- Witness(es) with name, address and signature:
- I, Shri/Smt. ________________________________ (Nominee) *We, Shri/Smt. _______________________________ (Nominee), Shri/Smt. ________________________ and Shri/Smt. _________________________ the survivors of the joint hirers, hereby acknowledge the receipt of the contents of the safety locker comprised in and set out in the above inventory together with a copy of the said inventory.
Shri/Smt. ______________________(Nominee) Shri/Smt. ______________(Survivor) Signature ______________________ Signature ______________________ Date & Place____________________
Shri/Smt. ______________(Survivor) Signature ______________________ Date & Place___________________
(* Delete whichever is not applicable)
APPENDIX
List of Circulars superseded
S.No. Circular No.^ Description^
Date of Circular 1 UBD.CO.BPD.(PCB).Cir.No.22/12.05.001/ 009-
Extension of Safe Deposit Locker/Safe Custody Article Facility and Access to Safe Deposit Lockers/Return of Safe Custody Articles by banks – Urban Co-operative Banks
November 16, 2009
2 RPCD.CO.RF.BC.No.42/07.38.01/2009-10 Safe Deposit Lockers November 13, 2009 3 UBD.CO.BPD.No.47/12.05.001/2006-07 Extension of Safe Deposit Locker / Safe Custody Article Facility and Access to Safe Deposit Lockers / Return of Safe Custody Articles by banks.
June 21, 2007
4 RPCD.CO.RF.BC No.95/07.38.01/2006-07 Extension of Safe Deposit Locker / Safe Custody Article Facility and Access to Safe Deposit Lockers / Return of Safe Custody Articles by banks.
May 18, 2007
5 DBOD.No.Leg.BC.78/09.07.005/2006-07 Safe Deposit Lockers/Articles in Safe Custody
April 17, 2007 6 DOS.No.FGV[F].BC.9/23.04.086/2000-2001 Safe Deposit Vaults/Locker facilities
March 9, 2001 7 RPCD.No.BC.36/07.38.01/96-97 Operation of Safe Deposits Lockers by Customers
September 10, 1996 8 DOS.No.FGV.BC.14/23.07.01/96-97 Operation of Safe Deposit Lockers by Customers
July 9, 1996 9 DBOD.No.GC.BC.63/C.408.C(L)-90 Safe Deposit Vaults/Locker facilities
January 2, 1990 10 DBOD.No.GC.BC.3/C.408C(L)-88 Estimate Committee’s Report- Safe Deposit Locker Facility
July 13, 1988 11 DBOD.No.GC.BC.27/C.408(L)-84 Safe Deposit Locker Facility March 27, 1984
