Indian Banking Laws (Amendment) Bill 2024: What You Need to Know!

Nirmala Sitharaman, India's Finance Minister, recently introduced the Banking Laws (Amendment) Bill, 2024, in the parliament. Sitharaman States, “The proposed changes in the Banking Laws (Amendment) Bill, 2024, will enhance governance and customer convenience in the sector.”

The FM stated a total of 19 amendments are being proposed to bring changes in the Reserve Bank of India Act, 1934, the Banking Regulation Act, 1949, the State Bank of India Act, 1955, the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, and the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980.

These are the changes that you should be aware of-

1. Bank account holders can include up to four nominees in their accounts under the proposed modification.

2. The substantial interest' maximum for directorships is now ₹2 crore, up from ₹5 lakh previously.

3. It also suggests that a director of a Central Cooperative Bank serve on the board of a State Cooperative Bank.

4. It aims to change the banks' reporting dates for regulatory compliance from the second and fourth Fridays to the fifteenth and last day of each month.

5. It seeks to provide banks more flexibility over the compensation that should be given to official auditors.

The finance minister said that since 2014, the government and the Reserve Bank of India (RBI) have been “extremely cautious” so that banks remain stable. “The intention is to keep our banks safe, stable, and healthy, and after 10 years, you are seeing the outcome,” she stated.