DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : G.Rajeswari
Designation : Senior Lecturer
Branch : Commercial and Computer Practice
Institute : Government Polytechnic, Srikakulam.
Year/Semester : V semester
Subject : Banking
Subject code : CCP 504(B)
Topic : Customer service in Banks
Duration : 50mts
Sub topic : Banker’s duty in case of Illiterates and
Joint account-holders
Teaching Aids : PPT, Animation
CCP504(B).42 1
Duties of Banker in case of illiterates and
joint account-holders.

Objectives:-
On completion of this Topic, you would be able to:
 Understand the banker’s duty in case of illiterates.
 Understand the banker’s duty in case of joint
account holders.

CCP504(B).42 2
Recap:

 In the previous class, you have learnt the banker’s duty

while opening accounts for Trustees.
 Trustee is a person in whose care the control of an
estate is placed under an instrument of trust or trust
deed.

CCP504(B).42 3
 Recap:

 If a trustee opens an account with the bank in his official

capacity, the banker must take the following
Precautions:-
 He must be familiar with the terms and conditions of
appointment

CCP504(B).42 4
Recap:

 He should not combine the trust account and

personal account of a trustee.
 The banker should specifically indicate the title of the
account.
 The banker should see that the trustee should not
delegate his powers to a third party.

CCP504(B).42 5
Known to Unknown

 Who is an illiterate?
 Can illiterates open an account in a bank?
 How he operates the account?

CCP504(B).42 6
Duties of Banker in case of illiterates

 An illiterate person cannot read or write.

 He can open an account in the bank.
 As illiterate persons cannot sign their names, the
bankers take their thumb impression as a substitute for
signature and also a copy of their recent photograph.

CCP504(B).42 7
Duties of Banker in case of illiterates

 The application form and the photograph should be

attested by an approved witness.
 For withdrawing money, he must attend personally
and affix his thumb impression in the presence of an
official of the bank, for the purpose of identification.

CCP504(B).42 8
 Duties of a banker in case of Joint
account holders

 When two or more persons open an account

jointly, it is called a joint account.
 Such an account may be opened by any two
persons for the sake of convenience of operation
of account and also for withdrawal of money after
the death of any of them.
 The banker should take the following precautions
in opening and dealing with a joint account:

CCP504(B).42 9
Duties of a banker in case of Joint
account holders

1. The application for opening a joint account must

be signed by all the persons intending to open a
joint account.
2. The banker should obtain clear instruction in
writing, signed by all the joint account holders,
regarding the operation of the account.

CCP504(B).42 10
Duties of a banker in case of Joint
account holders

1. The joint account may be operated in any

of the following ways.
• By all the depositors jointly.
• By either or survivor of them.
• By former or survivor of them.

CCP504(B).42 11
Duties of a banker in case of Joint
account holders

• In the absence of any instructions, the banker

should honor only those cheques which bear the
signature of all the persons in whose names the
account stands.

CCP504(B).42 12
Duties of a banker in case of Joint
account holders

• The joint account holder, who is authorized to

operate the account, himself alone cannot
appoint an agent or attorney to operate the
account.
• An agent or attorney may be appointed with the
consent of all the joint account holders.

CCP504(B).42 13
Duties of a banker in case of Joint
account holders

• Any joint account holder can stop payment of a

cheque issued on a joint account.
• The full name of the account must be given in all
the documents furnished to the banker.

CCP504(B).42 14
Duties of a banker in case of Joint
account holders

2. The banker should also take a mandate to ascertain

whether the persons operating the joint account are also
authorized to overdraw the account.
3. If so, it is desirable to establish separate individual liability of
all the joint account holders in addition to their joint liability.
4. The authority to operate the account can be revoked by any
of the persons giving such authority.

CCP504(B).42 15
Duties of a banker in case of Joint
account holders

1. It is automatically revoked if any of the joint

account-holders dies, becomes bankrupt or
unsound mind.
2. The banker must stop payment in such cases.
3. The banker should be given clear instructions
regarding the withdrawal of securities in the joint
account.

CCP504(B).42 16
Duties of a banker in case of Joint
account holders

2. In case the shares are in the joint names, all such persons
must sign the transfer form.
3. A joint account may be operated by either of the joint
account holders.
4. But if a cheque is drawn and signed by one of them, any
alterations there in should also be done by the same
person and not the other one.
5. The alteration should bear the signature of the drawer.

CCP504(B).42 17
Duties of a banker in case of Joint
account holders

1. The balance in joint account may be payable to:-

i. All of them or the survivor or survivors of them.
ii. Either or any one or more of them or the survivor
or survivors of them
2. Nomination facility is also available for joint account.

CCP504(B).42 18
Summary

 Illiterate persons can open bank accounts.

 While opening bank accounts for illiterates, banks
take their thumb impressions and photographs.
 The illiterates has to attend personally to draw
money from the bank.
 When two or more persons open an account
jointly, it is called a joint account.

CCP504(B).42 19
Summary

 The joint account may be operated in any of the

following ways.
i. By all the depositors jointly
ii. By either or survivor of them
iii. By former or survivor of them

CCP504(B).42 20
Summary
 The alteration should bear the signature of the
drawer.
 The balance in joint account may be payable to:-
i. All of them or the survivor or survivors of
them.
ii. Either or any one or more of them or the
survivor or survivors of them.
 Nomination facility is also available for joint
account.

CCP504(B).42 21
Quiz

1. Bankers take the following when an

illiterate opens a bank account.
• Thumb impression
• Recent photograph
• House tax
• Both A & B

CCP504(B).42 22
Quiz

2. For withdrawing money an illiterate must

attend personally and affix the following.
a) Photograph
b) Post card
c) Thumb impression
d) None

CCP504(B).42 23
Quiz

3. Joint account means

a) Two or more persons open an account
b) One person open an account
c) Both a & b
d) None of the above

CCP504(B).42 24
Quiz

4. Which of the following is a way to operate a

joint account?
a) By all the depositors jointly
b) By either or survivor of them
c) By former or survivor of them
d) All the above

CCP504(B).42 25
Quiz

5. Nomination facility is available for joint account.

a) yes
b) no

CCP504(B).42 26
Frequently Asked Questions

2. Explain the banker’s duty in case of an illiterate.

4. Explain the banker’s duty in case of joint accounts.

CCP504(B).42 27