Joint Account Rules and Regulations in India

Understanding the Joint Account rules in India

Key Takeaways

Joint Accounts have more than one account holder.
Depending on the account mode, account holders can enjoy certain privileges.
Joint and Joint or Survivor Accounts need all account holders to mandate transactions.
For Former or Survivor and Latter or Survivor accounts, account operation gets passed to the other only if one of the account holders dies.
Since money can be withdrawn without any consent, you must only open Joint Accounts with people you trust.

A Joint Account is a Bank Account with more than one holder. Such an account can be a Savings Account, Current Account, Fixed Deposit, Loan Account, etc. For these accounts, questions like 'who is the owner', 'who can withdraw money', and 'can I remove other account holders' are legitimate. Our comprehensive guide on Joint Bank Account rules answers all such questions.

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Joint Account Rules in India

Joint Accounts are like Regular Bank Accounts, except they are operated by more than one account holder. Not every account holder of a Joint Account can deposit and withdraw money, transfer funds, make ATM withdrawals, issue cheques, etc.

Account Operation

You can open a Joint Account like you would open a regular bank account, i.e., fill out the account opening form and complete the Know Your Customer (KYC) process. Simply select the mode of holding as joint. Following are the Joint Bank Account Rules in India per the account mode.

Joint: All transactions in the account must be approved and signed by all the account holders. If any one of the account holders dies, the account will be deemed inoperable, and the bank will pass on the balance in the account to the survivor.
Joint or Survivor: This account is similar to the Joint one; however, the survivor can continue to operate the account.
Either or Survivor: This account has two account holders, a primary and secondary account holder, and either or both can operate the account.
Former or Survivor: Only the primary account holder can operate this account. Per Joint Bank Account rules on death, the other joint account holder can operate the account upon the demise of the primary account holder.
Latter or Survivor: The second account holder can operate the account. After their death, the primary account holder takes over the operations.
Anyone or survivor: This type of Joint Account is operated by more than two persons, and they do not require each holder to sign off on transactions.

Funding

Account holders must establish the purpose of the joint account to decide how the account will be funded. Depending on the account type, not all account holders can operate the account, which also means limitations on deposits.

Withdrawal

In 'Either or Survivor' and 'Anyone or Survivor' accounts, joint holders have access to funds without consent from others, regardless of who funds the account.

Account Closing

Whether you are the primary account holder or not, you can choose to close the account at any time. However, in the case of 'Joint', all members must sign the account closing form.

Final Note

Joint Accounts come with numerous benefits, especially for spouses and business partners looking to manage their expenses jointly. However, there are certain Joint Account rules and regulations that all account holders must follow. You must open joint Accounts only with those whom you trust. All account holders must agree to the stipulated terms and conditions before opening a Joint Bank Account.

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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.