What Are Bank Account Nomination Rules in India?

Bank account nomination rules in India are set out in the Banking Regulation Act, 1949, and the Banking Companies (Nomination) Rules, 2025, which took effect on November 1, 2025 and replaced the 1985 rules.¹ You can now name up to four individuals on one account, register the nomination on paper or through internet or mobile banking, and be confident the bank will pay them directly after your death without demanding a court order. What the nominee receives, however, is not automatically theirs to keep: legal heirs retain ownership rights, and the nominee holds the money as trustee. Getting the form right takes a few minutes. Skipping it can cost your family months.

Who You Can Name

Only individuals can be nominees. A company, trust, or association cannot be named. Under the 2025 rules, a depositor may nominate up to four individuals on a single account, a significant change from the old one-nominee limit.¹

You can name a minor. If you do, you must appoint another adult to receive the deposit on the minor’s behalf should you die before the minor turns eighteen. The form asks for the minor’s age so the bank knows when guardianship ends.¹

For each nominee the form captures the full legal name, residential address, and relationship with you. Small mismatches between what you write here and what appears on your nominee’s identity documents cause delays at claim time, so it is worth double-checking.

Simultaneous or Successive Nomination

The 2025 rules give you two ways to structure multiple nominees, and the difference changes how your money is distributed.

With simultaneous nomination, you name several people at once and set a percentage share for each. You might allocate 50% to your spouse, 30% to your child, and 20% to a parent. All the named nominees receive their share when the claim is settled.

With successive nomination, you rank the nominees. The second is a backup for the first, the third a backup for the second, and so on. A later nominee only steps in if everyone above them has already died before the deposit becomes payable.

The total across either structure is capped at four individuals.¹ For most families with multiple dependents, some combination of the two is more useful than the single-nominee constraint that used to apply.

How to Register, Change, or Cancel

You can register a nomination at your branch by filling in the nomination form, or through internet or mobile banking if your bank offers e-nomination. The 2025 rules explicitly recognize digital nominations as long as the system captures all the prescribed details and authenticates you either by an electronic signature under the Information Technology Act, 2000, or through internet or mobile banking credentials.¹

If you sign with a thumb impression rather than a written signature, two witnesses must attest the impression on the form. This applies whether you are creating, changing, or cancelling the nomination.² Written signatures do not need witnesses.

Once the bank processes the form, the nominee’s name is registered in its records and is typically printed on your passbook or statement as confirmation. You can change or cancel a nomination whenever you want, either by submitting a fresh form or through the digital channel. Each new nomination automatically supersedes the previous one, so there is no separate cancellation step needed when you replace an old nominee.

Nomination is not compulsory. A bank cannot refuse or delay opening your account because you decline to nominate. If you do decline, the bank will ask you to sign a written declaration to that effect, and if you refuse the declaration too, the bank must simply record the refusal and open the account anyway. Choosing not to nominate is legal, but as the last section explains, it is expensive for whoever you leave behind.

Joint Accounts and the Survivorship Clause

In a joint account, all account holders must sign the nomination form together. The nominee’s right to claim only kicks in after every joint holder has died. While any joint holder is alive, the account continues to operate under whatever mandate governs it.³

There is a trap here that catches many families. The surviving holder’s automatic access to the balance depends on the account having a survivorship clause such as “Either or Survivor,” “Anyone or Survivor,” or “Former or Survivor.” Without such a clause, the deceased holder’s share does not automatically pass to the survivor and may require the same legal documentation as an account with no nominee at all.³ Check what mandate your joint account carries; a nomination alone will not solve the problem while one holder is still alive.

Nominee Is Not the Same as Legal Heir

This is where nomination law confuses the most families. The nominee receives the funds from the bank, but holds them as trustee for the legal heirs of the deceased depositor.⁴ Section 45ZA of the Banking Regulation Act, 1949 allows the bank to pay the nominee “to the exclusion of all other persons,” but the same section keeps intact any right or claim that legal heirs may have against the nominee afterwards.⁵

The Supreme Court of India has held in multiple rulings that nomination under banking and securities law does not override succession law or a valid will. Ownership of the money still follows inheritance rules. If a nominee refuses to hand over the funds to the rightful heirs, those heirs can file a civil suit to recover it.

Once the bank pays the nominee, the bank’s liability is fully discharged and it plays no part in any dispute between the nominee and the heirs. That is precisely why the RBI tells banks not to insist on succession certificates, probate, or indemnity bonds when a valid nomination exists: the mechanism is designed to release money quickly and leave inheritance questions to the courts.³

If you want a specific person to actually own your money after your death, write a will. Nomination tells the bank who to pay. A will tells the law who inherits. They solve different problems, and using both is usually the right answer.

What Happens If a Nominee Dies First

If a nominee dies before you do, that particular nomination becomes invalid. With successive nomination, the next person in line steps in. With simultaneous nomination, the deceased nominee’s share falls back into the non-nominated procedure and the family will have to claim it as if no nominee had been named for that portion. Reviewing your nomination every few years, or after any major family change, keeps this from becoming a problem you never see coming.

Claiming the Money After the Depositor’s Death

When a depositor dies, the nominee (or the surviving holder of a joint account with a survivorship clause) needs to bring the bank three things:

A certified copy of the death certificate, which the bank will verify against the original.
Their own photo identification and address proof, matching the bank’s KYC norms.
The bank’s deceased-claim application form.

Where there is a valid nomination or a survivorship clause, the bank should not ask for a succession certificate, probate, letter of administration, or indemnity bond.³ If a bank insists on those anyway, that is contrary to RBI guidelines and the matter can be escalated to the banking ombudsman.

Under the RBI’s Settlement of Claims in Respect of Deceased Customers of Banks Directions, 2025, banks must settle deposit claims within 15 calendar days of receiving all required documents. If the bank delays beyond that period through its own fault, it must pay compensation as interest at not less than the prevailing Bank Rate plus 4% per annum on the settlement amount for the delay period.

If There Is No Nominee

When a depositor dies with no nominee registered and no survivorship clause in place, the claim process gets much heavier. The RBI’s 2025 directions use a threshold to keep small claims moving:

For claims up to ₹15 lakh at commercial banks or ₹5 lakh at cooperative banks, the bank can settle without a succession certificate. Legal heirs submit a claim form, death certificate, identity proof, an indemnity bond, and either a legal heir certificate or a declaration from an independent person acceptable to the bank. A no-objection certificate from other heirs may be required if only one is claiming.
Above those thresholds, the bank requires a succession certificate from a civil court, a legal heir certificate from a competent revenue authority, or an affidavit sworn before a notary or magistrate. Where a will exists, banks can accept probate or letters of administration, and in some cases may act on an uncontested will without formal probate at their discretion.

A succession certificate is issued by a civil court and authorizes recovery of specified debts and securities. A legal heir certificate is issued by a revenue or municipal authority and identifies who the heirs are. Both are accepted, though the succession certificate carries more weight for financial asset recovery. Obtaining either takes time and money, including court or government fees and state-varying stamp duty on any indemnity bond.

The gap is stark. A nominated account pays out within 15 days against a death certificate and ID proof. A non-nominated one can take weeks or months, and for higher balances may pull the family into court. Filling in the nomination form, whether on paper at the branch or through your bank’s app, is the cheapest piece of estate planning you will ever do.

1
The Gazette of India. Banking Companies (Nomination) Rules, 2025
2
Utkarsh Small Finance Bank. Nomination Policy
3
Reserve Bank of India. Settlement of Claims in Respect of Deceased Depositors – Simplification of Procedure
4
Reserve Bank of India. Master Circular on Maintenance of Deposit Accounts – UCBs
5
International Financial Services Centres Authority. The Banking Regulation Act, 1949