Renting a bank locker: Remember it shouldn’t be in vain

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The Reserve Bank of India has changed the criteria for leasing safe deposit boxes from banks. If the contents of the locker are lost due to catastrophes such as fire, building collapse, or fraud by bank personnel, the central bank has limited the bank’s responsibility to only 100 times the yearly fee.

The new standards will come into effect on January 1, 2022, and will apply to both new and existing safe deposits, as well as the banks’ secure custody of items facility.

“Banks need to take all the necessary steps to ensure the safety and security of the premises where your valuable vaults are kept. It is responsible for ensuring that events such as fire, theft/burglary/robbery, dacoity, and building collapse do not occur in the bank’s premises as a result of its inadequacies, carelessness, or any act of omission/commission,” the RBI stated in its notification.

“Because banks cannot be responsible that they bear no liability towards their customers for loss of locker contents,” it continued, “in such situations where the loss of locker contents is due to the incidents mentioned above or to fraud committed by its employee(s), the banks’ liability shall be for an amount equal to one hundred times the prevailing annual rent of the safe deposit locker.”

When will the bank be held accountable? 

Banks shall be held responsible for the loss of locker contents as a result of a fire, theft, burglary, robbery, dacoity, building collapse, or fraud perpetrated by bank personnel. The bank’s responsibility, however, will be restricted to 100 times the yearly rent.

When the bank is not responsible?

While the banks have been asked to implement a Board-approved policy outlining their responsibility for any loss or damage to the contents of the lockers caused by their negligence, the banks will not be liable for loss of locker content caused by natural calamities, or “Acts of God,” such as earthquake, flood, lightning, and thunderstorm.

Locker Rentals 

To guarantee that locker rent is paid on time, the RBI has permitted banks to acquire a Deposit at the time of assignment. Such deposits would cover three years’ rent as well as the costs of breaking into the locker in case of any. 

Banks have also been instructed not to require such term deposits from existing locker holders or those with a suitable functioning account.

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