RBI asks urban co-op banks to modify fixed deposit form

http://www.financialexpress.com/news/rbi-asks-urban-coop-banks-to-modify-fixed-deposit-form/995501/0

The Reserve Bank (RBI) has asked the urban co-operative banks to modify fixed deposit (FD) account opening form to allow pre-mature withdrawal in the event of death of one of the joint account holders without any penalty.

Under the modified norms, it would be easier for the surviving joint account holders of FD with 'either or survivor' or 'former or survivor' mandate to go in for pre-mature withdrawal of fixed deposit in the event of death of the other.

As per the notification of the Reserve Bank of India (RBI), banks will have to incorporate a clause in the FD form to give option of premature withdrawal by survivor in case of death of the other joint account holder.

It further clarified that "such premature withdrawal would not attract any penal charge".