Rights and duties of a banker pdf

Bankers can disclose only such information, which is required by law or only after customers have given permission. Banks are not allowed to provide your details to telemarketing companies or for cross-selling. Banks are responsible for all the products and services offered by them and customers have the right to easy and simple grievance redressal systems in case the bank fails to adhere to basic norms. Along with their own products, bankers are responsible for the products of third parties like insurance companies and fund houses.

If the customer complaint is not resolved by the bank, customers can go to the banking ombudsman. See Also: How your bank may cheat you? It is the duty of customers to present the cheque and other negotiable instruments only during the business hours of the bank.

It is the duty of the customer to present the instrument of credit within the due time from the date of issue. The bank is liable to pay the compensation to the customer, if it wrongfully refuses to honor the cheque. It is the duty of the bank to follow the instructions given by the customers. If the customer has not given any instructions, the bank should act as per rules and regulations. Not happy with a product or service?

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The Overdraft allows the customer to borrow the funds from the bank in case of zero balance in their account. In Indian Overseas Bank, Madras v. It has been held that overdraft is an express and implied agreement between the bank and its customer. Banker is bound to honor the cheque as the overdraft arrangement between the bank and a customer is a contract and it cannot be terminated by the bank unilaterally.

The presentation of a cheque must be within the usual hours of business and if at all then the banking hours. The cheque must be presented within a reasonable time after the ostensible date of its issue. If the cheques are presented after six months after the ostensible date of issue it will be considered as stale cheque. A cheque must contain the date and banker is not bound to honor the undated, postdated or a stale cheque.

The signature on the cheque should be totally the same taken at the time of opening of the account. Banker is not bound to encash the forged cheque. It was held the banker is liable to pay compensation to the customer if he neglects to verify the signature a paid the amount on forged signatures.

The cheque will be honored if it fulfills all the conditions required by law. The cheque must not be torn, mutilated or canceled. The banker should verify the amount mentioned in the cheque.

If he finds the difference between words and figures, then he can refuse to honor it. Section 18 of the Negotiable Instrument Act says the amount written in words must be taken into consideration if the amount mentioned in words and figures does not match.

And if the cheque contains the amount in words but there is no mentioning of the amount written in figures then banker should return it but not vice versa.

The banker should not accept a cheque materially altered. He should verify it to the drawer. If a cheque is altered by the drawer he should consent the alteration and if the cheque is altered by the third party then the bank should refuse it. The banker will honor a cheque when the funds meant for its payment. For e. The banker will not honor the cheque if there will be any legal bar on the holder of the cheque.

The bank should note instruction of attachment by courts, income-tax officers immediately in the accounts ledger and concerned records. The banker should verify the signature of the partners on the cheque and seal of the company before honoring the cheque. But the banker must inform the customer about the appropriation. If the customer has more than one account or has taken more than one loan from the banker, the banker can appropriation these loans by the accounts.

The bank has the implied right to charge interest on loans and advances and charge commission for services rendered by the bank, such as SMS notification service, retail banking, multi-city cheque service, etc.

As a creditor, a banker has the implied right to charge interest on the loans granted to the customer. In the same way, incidental charges like service charges, processing fees, appraisal charges, panel charges may be imposed by the banker on the customer. Deposit are repayable on the term and made by the customer. Still, the period of limitation for the refund of bank deposit is three years with effect from the date a customer made a demand for his money.

If the bank believes that an account is not being operated properly, it may close the account by sending a written intimation to the customer. But the notice is mandatory. The relationship between the banker and customers creates some obligations on the part of a bank.