Friday, June 30, 2023

Customers suffer the most from the new bank locker law

 MUMBAI: Banks are urging customers to sign the new locker agreements because Friday is the deadline for updating fifty percent of them. The procedure, on the other hand, has become cumbersome as a result of a lack of uniformity, not only among banks but also among branches.

Despite customers being instructed to visit and update these documents, many bank branches are unprepared and lack the necessary documents for signing the agreements. Clients have communicated disappointment over the irregularity in stamp obligation groups between branches in a similar state. ICICI Bank, HDFC Bank, and Axis Bank branches demand a Rs 500 stamp paper, whereas some public sector bank branches accept a Rs 100 stamp duty.

The RBI instructed banks to have customers sign new contracts by January 2023, per an order issued by the Supreme Court in 2021. Later, the RBI requested that the Indian Banks Association's model agreement be amended to extend the deadline to December 2023. The reexamined understanding commanded that banks forestall fire, burglary and building breakdown while restricting their risk to multiple times the yearly storage lease.

By the end of June 2023, the directive required 50 percent of locker renters to sign the updated agreement. Customers who had previously signed contracts were required to sign additional contracts.

In addition, there is no established policy regarding who is responsible for paying the stamp duty. Most banks anticipate that clients should bear the expense. However, SBI stated that it would pay for the additional agreement's documentation costs.

"State Bank has only provided Rs 100 stamp paper for existing customers, while Indian Bank is asking customers to bring Rs 500 stamp paper. Kedar Chandak, a Mumbai-based bank customer, stated, "In addition to the excess value of the stamp paper, Indian Bank is charging its clients an additional registration fee of Rs 500 to Rs 1,000."

Indian Bank responded by stating that when customers submit the modified locker agreement, branches are instructed to only collect the required stamp duty amount in accordance with state laws. Due to the RBI's revisions, the bank clarified that customers must submit a re-modified or supplementary agreement if a modified agreement was submitted prior to February 28, 2023. In this scenario, the bank would pay the stamp duty.

The bank emphasized that only new locker hirers are eligible to pay the one-time registration fee. Additionally, when customers are out of town, different procedures are observed. Ravi Agarwal, a Mumbaikar, has joint storage spaces with his child and little girl, who live in the US and the UK. While a private bank insists on having their signatures certified at the Indian embassy, the Bank of Baroda will accept signed documents.

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