Starting November 1, 2025, bank customers in India will be able to nominate up to four persons in their accounts under the new provisions of the Banking Laws (Amendment) Act, 2025. The change aims to ensure greater uniformity, transparency, and efficiency in claim settlements across the banking sector, according to a statement released by the Finance Ministry on Thursday.
The amended law allows depositors to make up to four nominations either simultaneously or successively, depending on their preference. Customers will also be able to assign specific shares or percentages of entitlement to each nominee, provided that the total share equals 100 percent. This will make the process of settlement smoother and prevent disputes in the event of the account holder’s death.
For articles kept in safe custody and safety lockers, only successive nominations will be permitted. This means that the next nominee’s right will become effective only upon the death of the nominee placed higher in order, ensuring continuity and clarity in the succession process.
The ministry stated that the Banking Companies (Nomination) Rules, 2025, which will include the procedure and prescribed forms for making, cancelling, or modifying multiple nominations, will be issued soon to operationalise the provisions across all banks in a uniform manner.
The Banking Laws (Amendment) Act, 2025, was officially notified on April 15 this year. It introduces a total of 19 amendments across five major legislations: the Reserve Bank of India Act, 1934; the Banking Regulation Act, 1949; the State Bank of India Act, 1955; and the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980.
According to the Finance Ministry, these amendments aim to strengthen governance standards in the banking industry, improve depositor and investor protection, ensure uniform reporting by banks to the Reserve Bank of India, and enhance the quality of audits in public sector banks. They are also expected to improve customer convenience through modernised and simplified processes such as flexible nomination options.
Earlier, on July 29, 2025, the government had notified other provisions of the Act that allow public sector banks (PSBs) to transfer unclaimed shares, interest, and bond redemption amounts to the Investor Education and Protection Fund (IEPF), aligning the practice with that followed by companies under the Companies Act.
The notification also raised the threshold for defining “substantial interest” in a banking company from Rs 5 lakh to Rs 2 crore, marking the first revision since 1968. Additionally, it extended the maximum tenure of directors in cooperative banks (excluding the chairperson and whole-time directors) from 8 years to 10 years, in accordance with the 97th Constitutional Amendment.
Overall, the amendments under the Banking Laws (Amendment) Act, 2025, are expected to modernise India’s banking framework, promote better governance, and strengthen depositor confidence while bringing consistency across all banking institutions.
