DEPOSIT POLICY

Introduction:
One of the important functions of the Bank is to accept deposits from the public
for the purpose of lending. In fact, depositors are the major stakeholders of the
Banking System. The depositors and their interests form the key area of the
regulatory framework for banking in India and this has been enshrined in the
Banking Regulation Act, 1949. The Reserve Bank of India is empowered to issue
directives / advices on interest rates on deposits and other aspects regarding
conduct of deposit accounts from time to time. With liberalization of the financial
system and deregulation of interest rates, banks are now free to price their
deposit products within the broad guidelines issued by RBI.
This policy document on deposits outlines the guiding principles in respect of
formulation of various deposit products offered by the Bank and terms and
conditions governing the conduct of the account. The document recognizes the
rights of depositors and aims at dissemination of information with regard to
various aspects of acceptance of deposits from the members of public, conduct
and operations of various deposits accounts, payment of interest on various
deposit accounts, closure of deposit accounts, method of disposal of deposits of
deceased depositors, etc. for the benefit of customers. It is expected that this
document will impart greater transparency in dealing with the individual
customers and create awareness among customers about their rights. The
ultimate objective is that the customer will get services which are rightfully
entitled to receive without much demanding.
While adopting this policy, the bank reiterates its commitments to individual
customers outlined in code of Banks Commitment to Customer adopted by the
Bank. This document is a broad framework under which the rights of common
depositors are recognized. Detailed operational instructions on various deposit
schemes and related services will be issued from time to time.
1. Know Your Customer (KYC) Guidelines
Know Your Customer (KYC) is the platform on which banking system operates to
avoid the pitfalls of operational, legal and reputation risks and consequential
losses by scrupulously adhering to the various procedures laid down for opening
and conduct of accounts.
The branches shall follow appropriate Know Your Customer (KYC) policies,
procedures and internal control mechanism designed to:

Establish and document the true identity and address of the customers
who maintain/establish relationships, open accounts or conduct business
transactions.
Obtain background information on existing and / or new customers.

Safeguard the Bank from the risks of doing business with any individual or
entity whose identity cannot be determined.
Protect the Bank from the risks of having business relationships with any
individual or entity who refuses to provide information, or who has
provided information that contains significant inconsistencies which cannot
be resolved after due examination.
2. Identification through documents provided by the customers:
The Bank shall establish customers' identity (true names, residential and
mailing address) with the help of certain official documents as may be
provided by the customer concerned in original such as

1)
2)
3)
4)
5)
6)

Passport
PAN Card
Voters Identity Card
Adhaar Card
Driving License
Job Card issued by NREGA signed by an officer of the State Govt. (for small
account)
7) The Letter issued by UIDAI containing details of name address and Aadhar
Number
8) Identity Card (subject to the Banks satisfaction)
9) Letter from a recognized Public Authority or Public Servant verifying the
Identity and Residence of the Customer to the satisfaction of bank
10)
Govt./Defence I D Card
11)
ID Cards of reputed Public Sector Employees
12)
Pension payment Orders issued to the Retired Employees by Central/State
Govt.Departments, Public Sector Undertakings
13)
Photo ID Cards issued by Post Office
14)
Photo Identity Cards issued to bonafide students by University approved
by the University Grants Commission. (UGC) and / or Institute appoved by All
India Council for Technical Education(AICTE) or any Central/State Education
Board or Government Agency
15)
Photo Identity issued by any Public Authority having proper record of
issuance of identity proof which is verifiable from records.
16)
Ex-Servicemen card with Photograph
17)
Bar Council / Medical Association / ICAI /ICWAI/ICSI card with
photograph
18)
Student Identity card with photo issued by reputed colleges with validity
during the course period
19)
Defence Dependent's card with photograph
20)
Married Woman Identity proof with maiden name, if supported with a
verified true copy of marriage certificate
21)
Credit Card with photo together with statement of such card, not more
than three months old
22)
Registered Property document with photo identity.
23)
Arms License issued by State/Central Government of India
24)
Freedom Fighter's pass issued by Ministry of Home Affairs, Government of
India with photograph of applicant.

25)
Employee State Insurance Card (ESIC) with photograph supported by
latest month's pay slip
26)
Talati/Patwarri (a local govt. official) attestation by way of putting rubber
stamp and signature . Gram/Sarpanch/Mukhiya attestation by way of putting
rubber stamp and signature ( For small accounts)
27)
Photo Bank ATM Card
28)
Kissan Photo Passbook
29)
CGHS/ECHS Photo Card
30)
Disability ID Card/handicapped medical certificate issued by the respective
State/UT Governments/Administrations
31)
Ration/PDS Card
For Address, the following Documents Accepted as proof of Residence
1) Ration Card
2) Electricity Bill
3) Adhaar Card
4) Driving License
5) Bank Account Statement
6) Signed letter having photo from employer (to the satisfaction of the bank)
7) Letter from any recognized public authority (to the satisfaction of the bank)
8) Credit Card Statement not more than 3 months old
9) Income/Wealth Tax Assessment order
10)
Signed Letter having photo from Public Sector Employer on letter head
11)
Letter from any recognized public authority having proper and verifiable
record of issuance of such certificate
12)
Voter ID Card (only if it contains the correct address)
13)
Pension payment orders issued to retired employees by Government
Departments/Public Sector Undertakings, if they contain current address
14)
Copies of Registered Lease & License agreement/Sale Deed/Lease
agreement
15)
Certificate and also proof of residence, incorporating local address as well
as permanent address, issued by the Hostel Warden of the
University/Institute, where the student resides, duly countersigned by the
Registrar/Principal/Dean of Student welfare. Such accounts shall however be
required to be closed on completion of education/leaving University/Institute
provided the constituent does not give any other acceptable proof of
residence to the bank.
16)
Any person including a student residing with relatives, along with their
identity proof, can also be accepted provided that declaration is given by the
relative such a person/the student is related to him/her and is staying with
him/her.
17)
In respect of officials of Central/State Governments and Public Sector
Undertakings, who are low risk customers for bank, branch heads may verify
the photo/identity and confirm residential address of such officials from
independently verifiable sources, to their satisfaction and permit opening of
accounts. This facility is extended only to the Gazetted officers of
Central/State Government and Senior Management and above functionaries
of Public Sector Undertakings

18)
Latest Telephone bills from any Telephone Service Providers and Mobile
Service Providers not more than 2 months old, post paid.
19)
Consumer Gas Connection Card/book/pipe gas bill
20)
Certificate from Ward/equivalent rank officer, maintaining election role
certifying address of the applicant.
21)
Post Office Savings Pass Book
22)
Caste and Domicile Certificate with communication address and
photograph.
23)
Certificate of Address having photo issued by Village Extension Officer
(VEO) Village Head or equal or higher rank officer. Branch to confirm the
authenticity of the certificate and that it has been issued by the person who is
holding the said office.
24)
Court Divorce Order - Marriage Annulment Order issued by the Court of
Law.
25)
Water bill ( not older than 3 months)
26)
Property Tax Receipt (not older than 3 months)
27)
Insurance Policy
28)
Signed Letter having photo from banks on letter head
29)
Vehicle Registration Certificate
30)
Registered Sale/Lease/Rent Agreement
31)
Caste Certificate having photo issued by State Government
32)
Passport of Spouse
33)
Passport of Parents ( in case of Minors)
34)
Kissan Photo Passbook
The Bank will not rely up on Ration Card as a document to establish one's
identity. Photograph of the customer and any one of the documents for identity
proof along with any one of address proof documents will be obtained for
opening of accounts of individuals. Apart from adhering to extant guidelines on
identification as applicable to the proprietor, Bank should call for and verify as a
proof of name, address and activity of the proprietorship concern and obtain any
two of the following documents for opening account of proprietorship concern.
a. Prescribed Proprietary Declaration Letter
b. Shop and Establishment Registration Certificate or any other similar
documents indicating the activities of the concern.
c. Telephone/ Utility Bill in the name of the concern if any.
d. Any Registration/Licensing document issued by Central Govt. or State Govt
Authority/Dept
e. Importer-Exporter Code(IEC) issued by the Office of Director General of
Foreign Trade(DGFT).
f. The complete Income tax return (not just the acknowledgement) in the name
of the sole proprietary concern where the firms income is reflected, duly
authenticated/ acknowledged by the Income Tax Authorities.
g. Utility bills such as electricity, water, and landline telephone bills in the name
of the proprietary concern. Branches should verify proof of the name, address
and activity of the concern, like
registration certificate (in the case of a registered concern),
certificate / license issued by the Municipal authorities under Shop &
Establishment Act,

 Sales and Income Tax Returns,

CST/VAT Certificate,
Certificate / Registration document issued by Sales Tax / Service Tax /
Professional Tax authorities,
License issued by the Registering authority like Certificate of Practice
issued by

Institute of Chartered Accounts of India,

Institute of Cost Accountants of India,
Institute of Company Secretaries of India,
Indian Medical Council,
Food and Drug Control Authorities, etc.

Any two of the above documents would suffice. These documents should be in
the name of the proprietary concern.
3. Types of Deposit Accounts:Various deposit products offered by the Bank are assigned different names. The
deposit products are categorized broadly into the following types. The Definition
of major deposits schemes are as under: a. Demand deposits means a deposit received by the Bank, which is
withdrawable on demand;
b. Savings deposits means a form of demand deposit which is a deposit
account whether designated as Savings Account, Savings Bank Account,
Savings Deposit Account or other account by whatever name called which
is subject to restrictions as to the number of withdrawals as also the amounts
of withdrawals permitted by the Bank during any specified period;
c. Term deposit means a deposit received by the Bank for a fixed period and
which is withdrawable only after expiry of the said fixed period and shall also
includes deposits such as Recurring /Cumulative/Annuity/Reinvestment
deposits/Cash Certificates, and so on;
d. Notice Deposit means term deposit for specific period but withdrawable on
giving at least one complete banking days notice;
e. Bulk Deposit means single Rupee Term Deposits of Rs. 1 crore and above;
f. Current deposit means a form of demand deposit wherefrom withdrawals
are allowed any number of times depending upon the balance in the account
or up to a particular agreed amount and will also include other deposit
accounts which are neither Savings Deposit nor Term Deposit;

4. Different Deposit Schemes and Products

Based on customers' need, market conditions, competition and other driving
forces, Bank is presently offering the following deposit products under various
deposit schemes.
PRODUCT
Savings Accounts

SCHEMES
AB Savings Bank
AB Kiddy Bank
AB Abhaya Plus
AB Abhaya SB Account
AB Abhaya Gold SB Account
AB Jeevan Abhaya Scheme
AB Super Salary SB Account
Abhaya first wealth pack
AB Basic Savings Bank Account
AB Current Account
AB Insurance linked Current Account
AB Premium Current Account
AB Fixed Deposit
AB Kalpataruvu Deposit
AB Recurring Deposits
AB Recurring plus Deposits
AB Tax Saver
AB Double
AB Money time
AB Freedom (Flexi) Deposit
Navshakti-90
Navshakti - Double

Current Accounts

Term Deposits

To meet the customer's need, market requirement or regulatory instruction,

Bank may at its discretion formulate different new deposit products suited for
cross section of the customers, which will be examined by the Asset-Liability
Committee (ALCO) and may be launched from time to time.
5. Non Resident Accounts
Rupee Deposits: Rupee deposits accepted from Non Resident Indians & Persons
of Indian Origin are maintained in the form of NRO and NRE accounts. Only
Individuals can open these accounts.
a) Non-Resident Ordinary (NRO) Account: NRIs can open Non-Resident Ordinary
(NRO) deposit accounts for collecting their funds from local bonafide
transactions. NRO accounts being Rupee accounts, the exchange rate risk on
such deposits is borne by the depositors themselves. When a resident becomes
an NRI, his existing Rupee accounts are designated as NRO accounts. NRO
accounts can also be opened to meet the requirements of foreign nationals
resident in India. These accounts can be maintained as current, saving, recurring

or term deposits. The interest rates on these deposits are in accordance with RBI
guidelines. However, the interest earned is subject to tax as per IT act.
While the principal amount of NRO deposits is non-repatriable, current income
and interest earned is repatriable. In such repatriations, the exchange risk is to
be borne by the depositors.
b) Non-Resident (External) Rupee Account NR (E) RA: These accounts are
opened with funds remitted to India through a banking channel from abroad.
These accounts are maintained as current, savings or term deposit. If it is a
term deposit, they are accepted for a minimum period of 1 year as per RBI
directives. Local payments can be freely made. This is a repatriable account and
transfer of funds from another NRE or FCNR (B) account is also permitted. Since
these accounts are maintained in Rupees, the depositor is exposed to exchange
risk for conversion into foreign currency.
c) Foreign Currency Non-Resident [FCNR(B)] Account: These deposits are
accepted from Nonresident individuals of Indian Nationality or origin (NRIs) and
are maintained in US dollar, Pound Sterling, Euro, Canadian dollars and
Australian dollars. Only term deposits are accepted under this category. The
depositors are protected from Exchange risk and the foreign exchange risk is
borne by Bank. As per RBI directives, the minimum maturity period is one year
and maximum maturity period is five years.
The interest rates payable on NRE deposits have been deregulated w.e.f.
16/12/2011. Interest rates on FCNR term deposits are as per the directives
of RBI.
In addition to prescribed NRI account opening Form and two passport size
recent photograph of the depositor, following documents are required to be
submitted to open non-resident account.
Photocopy of relevant pages of current passport of the customer with
name, address, photograph, signature, date of birth, date and place of
issue, expiry date and stamp regarding stay outside India.
Photocopy of Resident Visa/Work Permit/Employment Visa/ Current Visa
or any other proof of Non-Resident Indian status.
Address proof for overseas address. For NRI overseas residential
address, any one of the following documents may be obtained.
a. Passport copy with address,
b. Resident Card issued by the Government of the respective
country of residence,
c. Existing Bankers Statement (up to three months old)
d. Lease Deed/Title Deed of the property,
e. Driving license and Voter ID Card
f. Letter from Employer on letter head of the company along with
employee photo card and work-permit / Visa / Residence permit /
Visa with same employer name etc., Branch should obtain an
introduction of the account for identification. All documents should

be attested by (i) a person known to the Bank, (ii) or the

applicant's existing bank abroad, or (iii) Notary Public or (iv)
official of Indian Consulate / Embassy / High Commission.
The branch should also obtain telephone/fax number, e-mail id and
local address of the depositor for easy and faster communication.
6. Other Aspects
For deposit products like Savings Bank Account and Current Deposit Account,
the Bank will normally stipulate certain minimum initial deposit and certain
minimum balance to be maintained as part of terms and conditions governing
operation of such accounts. Failure to maintain minimum balance in the
account will attract charges as specified by the Bank from time to time. For
Savings Bank Account the Bank may also place restrictions on number of
transactions, cash withdrawals, etc., for a given period. Similarly, the Bank
may specify charges for issue of cheque books, additional statements of
account, duplicate passbook, folio charges, etc., as applicable to the specific
type of account. All such details, regarding terms and conditions for operation
of the accounts and schedule of charges for various services provided will be
made known to the prospective depositor while opening the account.
a. Savings Bank Accounts can be opened for eligible person/persons and
certain organizations / agencies (as advised by Reserve Bank of India from
time to time).
b. Current Accounts can be opened by Individuals / Sole Proprietary Concerns
/Partnership Firms / Private and Public Limited Companies / HUFs /
Specified Associates / Societies / Trusts.
c. Term Deposit Accounts can be opened by Individuals singly or jointly/
Partnership firms / Private and Public Limited Companies / HUFs / Specified
Associates /Societies / Trusts.
d. Deposit accounts can be opened by an individual in his own name (status:
known as account in single name) or by more than one individual in their
own names (Status: known as joint account). Savings Bank Account can
also be opened by a minor jointly with natural guardian or with mother as
the guardian (Status: known as Minors Account). Minors above the age of
10 will also be allowed to open and operate saving bank account
independently. However, no overdrafts will be granted to these minors.
Bank may, from time to time design /come out with new deposit products,
with certain additional benefits with or without payment of certain charges
to cater to needs of specified categories of depositors and the same may not
be made available to other customers. NRI accounts can be opened by
Individuals/Individuals singly or jointly with other NRI/NRIs.
e. Operation of Joint Account The Joint Account opened by more than one
individual can be operated by single individual or by more than one
individual jointly. The mandate for operating the account can be modified
with the consent of all account holders.
The operation of the account depends on the nature of the mandate given by the
depositors. The mandate for operations can be 1. Individually; 2. Jointly;

3. Either or Survivor /Any one or Survivor/s Former or Survivor. a) Either or

Survivor: If the account is held by two individuals say, A & B, and the operation
is on either or survivor basis, the final balance along with interest, if applicable,
will be paid to survivor on death of anyone of the account holders. b) Any one or
Survivor/s: If the account is held by more than two individuals say, A, B and C,
the final balance along with interest, if applicable, will be paid to the survivor on
death of the remaining account holders. c) Former or Survivor: If the account is
held on former or survivor basis, the final balance along with interest, if
applicable, will be paid to survivor on the death of Former. However, the above
mandates will be applicable to or become operational only on or after the date of
maturity in respect of term deposits. This mandate can be modified by the
consent of all the account holders. The Savings Bank account opened by minor
jointly with natural guardian / guardian can be operated by such guardian only.
NRE accounts and FCNR (B) accounts can be opened with resident individual as
joint account holder or Former or Survivor basis only.
At the request of the depositor, the Bank will register mandate / power of
attorney given by him authorizing another person to operate the account on his
behalf.
The term deposit account holders at the time of placing their deposits can give
instructions in respect of operations, which are included in Application for
opening of term deposit account. The customer can opt for auto renewal of the
deposit. Irrespective of his option, Customer may demand for payment or give
instructions to the contrary on or before the date of maturity of the deposit to
renew the deposit either with or without interest, if any due thereon, for similar
period at the prevailing rate of interest. However, in respect of Recurring
Deposit scheme (except Recurring Deposit Plus scheme), change in installment
amount originally agreed or the period of the deposit is not permissible.
The Bank will provide either a statement of account or a Pass Book to Savings
Bank as well as Current Deposit Account Holders periodically as per terms and
conditions of opening of the account. However, in case a customer holds a pass
book and still requests for a statement of account and vice versa, the same will
not be denied and will be provided on payment of charges as specified by the
Bank from time to time.
The deposit accounts may be transferred to any other branch of the Bank at the
request of the depositor subject to fulfillment of KYC norms at transferee branch.
However, if any deposit scheme is devised with a precondition that it cannot be
transferred to other places/ branches, the account will continue to be maintained
at the branch where it is opened.
7. Nomination facility:
It is available on all deposit accounts opened by the individuals. Nomination is
also available to a sole proprietary concern account. Nomination can be made
in favour of one individual only. Nomination so made can be cancelled or
changed by the account holder/s any time. Nomination can be modified by the
consent of account holder/s. Nomination can be made in favour of a minor also

subject to another individual being named as appointee during the period of

minority. Bank recommends that all depositors avail nomination facility. The
nominee, in the event of death of the depositor/s, would receive the balance
outstanding in the account as a trustee of legal heirs. The depositor will be
informed of the advantages of the nomination facility while opening a deposit
account.
8. Interest Payments:
a) RBI decided to deregulate the Savings Bank interest rate with effect from
25.10.2011 subject to the following conditions.

First, each bank will have to offer a uniform interest rate on savings
bank deposits upto Rs.1 lakh, irrespective of the amount in the account
within this limit.
Second, for savings bank deposits over Rs. 1 lakh, a bank may provide
differential rates of interest, if it so chooses, subject to the condition
that banks will not discriminate in the matter of interest paid on such
deposits, between one deposit and another of similar amount,
accepted on the same date, at any of its offices.
RBI, deregulate interest rates on both savings deposits and term
deposits of maturity of one year and above under Non-Resident
(External) Rupee (NRE) Deposit accounts and savings deposits under
Ordinary Non-Resident (NRO) accounts from 16.12.2011. However,
interest rates offered by banks on NRE and NRO deposits cannot be
higher than those offered by them on comparable domestic rupee
deposits. Bank will consider the increase in interest rate on SB
deposits basing on market conditions with the approval of ALCO
The interest is calculated on the minimum balance to the credit of the
deposit account on daily product basis and credited to the account only
when it is Rs.1/ or more. Method of calculation of interest is changed
to daily product basis w.e.f 01.04.2010.
The interest shall be calculated at quarterly rests on term deposits. In
case the term deposits are of monthly interest payment nature, the
interest shall be calculated for the quarter and paid monthly at
discounted value. The manner of calculation of interest is in
accordance with the formulae and conventions as advised by Indian
Banks Association/RBI from time to time. For the purpose of
calculation of interest on domestic term deposits, RBI has prescribed
that on deposits repayable in less than three months or where the
terminal quarter is incomplete, interest should be paid proportionately
for the actual number of days reckoning at 366 days in a leap year and
365 days in other years. Our bank is adopting the same.

b) The interest rates are subject to revision from time to time. Whenever
interest rates are revised, the revised rates are applicable to fresh
deposits as well as renewed deposits only. The interest rates offered are

10

non-discretionary and non-discriminatory and are applicable uniformly to

all depositors at all branches of the Bank.
c)

The rate of interest on deposits will be prominently displayed in the

branch premises and Bank's website. Changes, if any, with regard to the
deposit schemes and other related services shall also be communicated
upfront and shall be prominently displayed on Bank's website.

d) Tax deducted at Source: The Bank has statutory obligation to deduct tax
at source if the total interest paid / payable on all term deposits held by a
person exceeds the amount specified, presently Rs.10,000 p.a., under the
Income Tax Act. The Bank will issue a tax deduction certificate (TDS
Certificate) for the amount of tax deducted. The depositor, if entitled to
exemption from TDS can submit declaration in the prescribed format at the
beginning of every financial year. At the same time if the total interest to
be paid to an individual exceeds the threshold limit as specified by I.T.
Rules, tax will be deducted at source and no declaration will be accepted,
as per IT Rules / Laws. NRE Term Deposits are free from Tax where as
NRO Deposits attract TDS @ the rates applicable on the interest earned
without any Thresh hold limit. No declaration is accepted to waive the TDS.
DTAA concessions are available to customers on the production of certain
prescribed forms prescribed by IT authorities.
e) Deposits maturing on a holiday: In respect of a term deposit maturing for
payment on a Sunday or a holiday or a non-business working day, bank
would pay interest at the originally contracted rate on the deposit amount
for the Sunday/holiday/non-business working day also, intervening
between the date of the expiry of the specified term of the deposit and the
date of payment of the proceeds of the deposit on the succeeding working
day.
f) Rounding-off transactions: All transactions including payment of interest on
deposits will be rounded off to the nearest rupee; i.e., fractions of fifty
paise and above shall be rounded off to the next higher rupee and fraction
of less than fifty paise shall be ignored.
g) Deposits from Resident Senior Citizens: Senior citizens who have
completed 60 years of age, are given certain additional privileges, in tune
with the guidelines received from RBI. Proof of age is required for opening
senior citizen deposit accounts. Joint accounts with another senior citizen
or with person who is not a senior citizen is permitted. In the latter case,
only if the senior citizen is the first named depositor, the privileges are
applicable. Deposits are normally accepted for a minimum period of 14
days and for maximum period of 10 years. However, as per the decision
taken by the Bank from time to time the deposits for less than 14 days can
also be accepted for stipulated minimum amount of deposits. The
maximum period of ten years is also relaxed in certain cases. The
additional interest rate is payable on deposits of Senior Citizen over and
above the normal rates and informed by Bank from time to time in
advance. Presently additional interest rate at 0.5% over and above the

11

card rate is offered to Senior Citizens. NRO/NRE/FCNR accounts are not

eligible for additional rate of interest for Senior Citizens.
h) Deposits received from existing /retired Staff Members: Existing staff
members are eligible for additional rate of interest @1% in respect of a
savings or a term deposits account. Retired Staff members of our Bank,
spouse of a deceased member or a deceased retired member of the banks
staff who are Senior Citizens (60 years of age and above), will get an
additional interest of 0.5% in addition to 1% payable to them on their
deposits by virtue of being ex-staff of our Bank, upto a limit of Rs.1 Crore,
placed/renewed on or after 01.04.2011. The additional interest of 0.5% on
the deposits as mentioned above will be applicable only if the 1st name in
the deposit receipt is that of the retired staff member. Additional rate of
interest for 1% is applicable in respect of Savings or a Term Deposit
pertaining to an association or a fund, members of which are members of
the banks staff. Staff rate of interest is not applicable for NRE/NRO/FCNR
(B) deposits.
i) Payment of interest on accounts frozen by bank: The procedure is detailed
below in the case of Term Deposit Accounts of Customers frozen by orders
of the enforcement authorities:

A request letter is to be given by the customer for renewal for a term

equal to the original term, on maturity. In case the depositor does not
exercise his option of choosing the term for renewal, branch may renew
the same for a term equal to the original term.
No new receipt will be issued. However, suitable note will be made
regarding renewal in the deposit ledger.
Renewal of deposit shall be advised by registered letter / speed post /
courier service to the concerned Govt. department under advice to the
depositor. In the advice to the depositor, the rate of interest at which the
deposit is renewed will also be mentioned.
If overdue period does not exceed 14 days on the date of receipt of the
request letter, renewal shall be done from the date of maturity. If it
exceeds 14 days, interest for the overdue period shall be paid as per
Banks extant guidelines that are referred in this policy.
With regard to the savings bank accounts frozen by the enforcement
authorities, Bank will continue to credit the interest to the account on a
regular basis. However, withdrawal/debits can be allowed only when the
accounts are released by the Enforcement Authorities.
9. Accounts of Firms / Companies / Trusts / Associations, etc:
The above constituents can open domestic deposit accounts i.e. current,
term deposits by producing necessary documents as specified in the
application. All the members of the organization like partners, directors,
trustees, etc. are subject to compliance of KYC norms. Only certain types
of institutions are eligible to open Savings accounts.

12

10.Minors' Accounts
A minor can open Savings Bank account / Recurring Deposit account and
the same can be operated by the natural guardian or by minor himself /
herself, if he / she is above the age of 10 years. The accounts can also be
opened jointly.
On attaining majority, the erstwhile minor should confirm the balance in his
/ her account and if the account is operated by the natural guardian /
guardian, fresh specimen signature of erstwhile minor duly verified by the
natural guardian would be obtained and kept on record for all operational
purposes.
Some special schemes under Savings Bank accounts linked with insurance
coverage cannot be opened in the name of minors below the age groups
specified, terms and conditions of such special schemes are announced by
the bank from time to time.
11.Account of Illiterate Persons
A person who cannot read and write is considered as an illiterate person. The
Bank may at its discretion open deposit accounts other than Current Accounts
of illiterate person. Opening of Current Deposit Account in the name of an
illiterate person requires prior permission from Zonal authorities. However,
since the opening of account requires certain permissions, the same will be
delayed and the same will be intimated to the customer. The account of such
person may be opened, provided he/ she calls on the Bank personally along
with a witness who is known to both the depositor and the Bank. Normally, no
cheque book facility is provided for such Account. At the time of withdrawal /
repayment of deposit amount and / or interest, the account holder should affix
his / her thumb impression in the presence of the authorized officer who should
verify the identity of the person. The bank will explain the need for proper care
and safe keeping of the passbook etc. given to the account holder. The Bank
official shall explain the terms and conditions governing the account to the
illiterate person.
12.Account of Visually Impaired Persons:
Visually Impaired Persons may be allowed to open all types of deposit accounts,
except current accounts, either singly or jointly with other persons, whom they
consider reliable. Opening of Current Accounts for visually impaired persons at
the branch level requires prior permission from higher authorities and such
accounts will be opened after fulfilling the guidelines.
The rules of the deposit scheme in general and the special conditions if any
should be read and explained to the visually impaired person in the presence of
a witness in view of his physical infirmity. The witness should sign the Personal
Data Form and the Account Opening Form duly recording this aspect. To guard
against variation in specimen signatures of literate visually impaired person, his
specimen signature should be witnessed by a customer known to the bank.

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The bank will explain the need for proper care and safe keeping of the passbook
etc. given to the account holder. The Bank official shall explain the terms and
conditions governing the account to the Visually Impaired Persons.
13.Addition or deletion of the name/s of joint account holders
The bank may at the request of all the joint account holders allow addition or
deletion of name/s of joint account holder/s if the circumstances so warrant or
allow an individual depositor to add the name of another person as a joint
account holder. However the name of the first joint account holder cannot be
replaced.
14.Customer information:
The information collected from the customers shall not be used for cross selling
of services or products by the Bank, their subsidiaries and affiliates. If the Bank
proposes to use such information, it will be strictly with the consent of the
account holder. Bank should prepare a profile for each customer based on risk
categorization. This profile contains the information relating to customers
identity, social/financial status, nature of business activity etc. The customer
profile is a confidential document and details contained therein will not be
divulged for cross selling or for any other purposes.
15. Secrecy of Customers Accounts:
The Bank shall not disclose details / particulars of the customers account to a
third person or party without the express or implied consent from the customer.
However, there are some exceptions, viz. disclosure of information when the
interest of our Nation is at stake and compulsion of law, where there is a duty to
public to disclose and where interest of the Bank requires disclosure.
16. Premature withdrawal of Term Deposit:
The Bank on request from the depositor, at its discretion may allow withdrawal
of term deposit before completion of the period of the deposit agreed upon at
the time of placing the deposit.
The Bank shall declare its policy on penalty which will be levied by way of
interest reduction for premature withdrawal of term deposit. The Bank shall
make depositors aware of the applicable rate along with the deposit rate. No
interest will be paid, if Domestic Term Deposit is closed prematurely within 7
days from the date of deposit. The penalty of 1% at present is levied on
premature cancellation of Term Deposits. However, at present, the following
cases are exempted from levying penalty:
a. Deposits of Individuals up to Rs.5 lakh contracted for any maturity period.
b. Deposits of Corporates i.e., Corporations, Govt. undertakings, bodies, firms

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Institutions, associations etc. Up to Rs.100 lacs contracted upto 90

days.
NRE/FCNR deposits: No interest will be paid, if the deposit is withdrawn or
closed prematurely before one year.
17. Premature renewal of Term Deposit:
In case the depositor desires to renew the deposit by seeking premature closure
of an existing term deposit account, the bank will permit the renewal at the
applicable rate on the date of renewal, provided the deposit is renewed for a
period longer than the balance period of the original deposit. While prematurely
closing a deposit for the purpose of renewal, interest on the deposit for the
period it has remained with the bank will be paid at the rate applicable to the
period for which the deposit remained with the bank reckoning from the date of
deposit and not at the contracted rate.
18. Renewal of Overdue Term Deposits:
When a term deposit is renewed on maturity, on renewed deposit, interest rate
for the period specified by the depositor as applicable on the date of maturity /
date of renewal would be applied. If request for renewal is received after the
date of maturity, such overdue deposits will be renewed with effect from the
date of maturity at interest rate applicable as on the due date, provided such
request is received within 14 days from the date of maturity. In respect of
overdue deposits renewed after 14 days from the date of maturity, interest for
the overdue period will be paid at the rates decided by the Bank from time to
time.
19. Advances against Deposits:
The Bank may consider request of the depositor/s for loan / overdraft facility
against term deposits duly discharged by the depositor/s on execution of
necessary security documents.
The Bank may also consider loan against deposit standing in the name of minor,
however, a suitable declaration stating that loan is for the benefit of the minor,
is to be furnished by the depositor applicant. Similarly loans are permitted
against third party deposits. Advance against NRE/FCNR deposits is subjected to
guidelines given in FEMA/RBI from time to time.
Whenever loan is granted, a lien on the deposit is marked and bank shall have
the right to appropriate the deposit proceeds to the loan account on the date of
maturity, in case the loan remains unpaid. The interest rates applicable,
margins to be maintained etc. will be made known to the customers at the time
of availing the Deposit Loan and also will be placed on the Bank's website from
time to time.

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20. Settlement of claims in respect of Missing Persons:

As per Sec. 108 of Indian Evidence Act, if the whereabouts of a person is not
known or heard for seven years, a presumption can be raised by a competent
Court that the said person is dead unless the contrary is proved by the person
affirming the existence of said person.
While settling the claims in respect of a missing person, branches have to follow
the under mentioned guidelines and forward the same to the respective Zonal
Office for settlement of the claim.

Obtention of copy of FIR lodged by the legal heirs with police department.
Obtention of Non-traceable reportfrom the police department.
Letter of Indemnity.
Surety from two independent respectable persons well known to the
family of the depositor who are acceptable to the Bank.
Independent enquiry be made by the Branch to ensure that the depositor
is actually missing and genuineness of the claim / claimants.
Copy of the paper notification with photograph of the missing depositor in
a well circulated English / Local language newspaper should be produced
by the claimants.
Identification of the claimants, sureties is thoroughly verified.

Bank had fixed threshold limit of Rs.50,000/- up to which a claim in respect of

missing person be settled without insisting on production of any documentation
other than (i) FIR and the non-traceable report issued by police authorities and (
ii ) letter of indemnity with two third party sureties.
Zonal Managers are vested with powers to settle the claim in respect of missing
person upto Rs.50,000/-.If the claim amount is Rs.5,000/- and less, Zonal
Manager is empowered to dispense with production of the public notification /
paper publication of the missing person.
However, these settlement guidelines shall not be applicable in the following
cases.
a. Deposit/s held by the missing person jointly with another person/s
irrespective of the condition of repayment of the deposit.
b. Deposit/s held as per court orders.
c. Non Resident deposit accounts (held individually or jointly irrespective of the
condition of repayment).
d. Loan/s availed by the missing person where the deposit/s is provided as
collateral security.
e. Gold loans and loans against approved securities availed by the missing
person.
f. Safe deposit locker and safe custody articles held by the missing person
(individually or jointly )
g. Deposits where a lien has been noted (excluding such lien/s noted in case of
loan availed against the deposit as prime security and no other lien/s are
noted on the deposit).

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h. Claims where a missing person has left any Will.

i. Claims on deposit/s where the missing person has any direct or indirect
liabilities with the Bank (excluding loans against the claimed person as
prime security).
j. Claims where a person has gone missing in any country other than India.
21. Settlement of dues in deceased deposit account:
a) If the depositor has registered nomination with the Bank, the balance
outstanding in the account of the deceased depositor will be transferred to
the account of / paid to the nominee after the Bank is satisfied about the
identity of the nominee, etc.
b) The above procedure will be followed even in respect of a joint account where
nomination is registered with Bank.
c) In a joint deposit account, when one of the joint account holders dies, the
Bank is required to make payment jointly to the legal heirs of the deceased
person and the surviving depositor(s). However, if the joint account holders
had given mandate for disposal of the balance in the account in the forms
such as either or survivor, former / latter or survivor, anyone of survivors or
survivor, etc., the payment will be made as per the mandate to avoid delays
in production of legal papers by the legal heirs of the deceased.
d) In the absence of nomination and when there are no disputes among the
claimants, the Bank will pay the amount outstanding in the account of
deceased person against joint application and indemnity by all legal heirs or
the person mandated by the legal heirs to receive the payment on their
behalf without insisting on legal documents up to the limit approved by the
banks board. This is to ensure that the depositors are not put to hardship on
account of delays in completing legal formalities.
22. Interest payable on term deposit in deceased account:
a) In the event of death of the depositor before the date of maturity of deposit
and amount of the deposit is claimed after the date of maturity, the Bank
shall pay interest at the contracted rate till the date of maturity. Again from
the date of maturity to the date of payment, the Bank shall pay simple
interest at the applicable rate prevailing on the date of maturity, for the
period for which the deposit remained with the Bank beyond the date of
maturity, as per the Banks policy in this regard.
b) However, in the case of death of the depositor after the date of maturity of
the deposit, the bank shall pay interest at savings bank rate operative on the
date of maturity i.e., at present 4.00% p.a. from the date of maturity till the
date of payment.
c) In the case of balances lying in current account standing in the name of a
deceased individual depositor/sole proprietorship concern, interest shall be
paid only from 1st May, 1983, or from the date of death of the depositor,

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whichever is later, till the date of repayment to the claimant/s at the rate of
interest applicable to savings deposit as on the date of payment.
Note: In the case of a NRE deposit, when the claimants are residents, the
deposit on maturity shall be treated as a domestic rupee deposit and interest will
be paid for the subsequent period at the rate applicable to the domestic deposit
of similar maturity.
23. Insurance Cover for Deposits:
All bank deposits are covered under the insurance scheme offered by Deposit
Insurance and Credit Guarantee Corporation of India (DICGC) subject to certain
limits and conditions. The insurance premium is being paid by the Bank at
present. The details of the insurance cover in force will be made available to the
depositor.
24. Restrictions for payment of Term deposits on maturity by cash:
Section 269 T of Income Tax Act, 1961 prohibits repayment of term deposits or
notice deposits in cash if the amount involved, principal plus interest
is
Rs.20,000/- or more. Hence, the payment of such deposits is to be made by way
of credit to the account of the party (or) by way of A/c Payee crossed demand
draft or pay order, when,
a. The amount of the deposit together with interest, if any, payable thereon, or
b. The aggregate amount of the deposits held by such person with the branch of
the Bank in his own name or jointly with any other person, on the date of
such repayment, together with interest, if any, payable on such deposits, is
twenty thousand rupees or more.
25. Basic Savings Bank Deposit Account:
Bank offers basic banking facility of 'No-frills' account, either with nil or very
low minimum balances as well as charges that would make such accounts
accessible to vast sections of population. The nature and number of transactions
in such accounts would be limited, the details of which would be made known to
customers from time to time in advance.
These accounts also will be subjected to compliance with limited / simplified KYC
norms to satisfy banks about their identity.
26. Facility of ECS clearing:
It is a mode of Electronic Funds transfer from one Bank account to another bank
account using the services of a Clearing House. Normally bulk transfers take
place from one account to many accounts or vice-versa under this facility. This
facility is available at limited centers only, as made available in the web-site of
RBI. Bank provides the facility on merits of the case duly observing the KYC
norms, at these identified centers.

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27. ATM / Debit Card

ATM / Debit card will be issued to a Account holder based on his request. ATM
Card is used for withdrawal of cash from Automated Teller Machines. Debit Card
is a payment card used to with draw cash from ATM, purchase of goods and
payment for services automatically debiting to the card holder's bank account
instantly, to the extent the credit balance exists. In ATM / Debit card the
customer can draw cash from ATM upto the balance available in his account
subject to daily caps prescribed by Bank from time to time. While providing ATM
/ Debit card, a customer is provided a PIN number to facilitate withdrawal of
amount. Debits to the account using ATM / Debit Card through PIN Number are
treated as mandate for withdrawal of the cash by the customer from the account
28. Internet Banking:
Internet Banking is provided to Individual/Joint/Sole proprietary concerns,
Corporates etc. at their request. The terms and conditions governing Internet
banking are displayed on the Bank's website. These terms and conditions are
supplementary to and not independent of the terms and conditions governing
the type of account the customer maintains with the Bank. Any change in the
terms and conditions of "Internet Banking" will be displayed on the website only
and not by any means of communication directly to the user of internet banking.
The opening and maintenance of the account is subject to rules and regulations
introduced or amended from time to time by Reserve Bank of India.
Bank can, at its sole discretion, withdraw any of the services / facilities given for
the account either wholly or partially at any time without giving any notice.
Debits to the accounts by an NRI for the purpose of investment in India and
Credits representing sale proceeds of investments, user has to ensure that such
investments or disinvestments would be covered either by the general or special
permission of RBI. Further, the debits and credits to the accounts shall not be
for the purposes prohibited by RBI.
29. Facility of opening Pension accounts:
Pension Accounts are opened on receipt of advice from pension disbursing
authorities with all the relevant documents sent to the Bank at identified places
/ branches. Payment of pension will be made as directed by the pension
disbursing authority. The terms and conditions for opening of accounts in the
name of pensioners are available at these selected branches of the Bank. The
other terms and conditions will be informed by the Bank from time to time.
30. Stop Payment Facility:
The Bank will accept stop payment instruction from the depositors in respect of
cheques issued by them. Charges, as specified, will be recovered.

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31. Dormant Accounts:

A saving as well as current account shall be treated as inoperative / dormant if
there are no transactions in the account for over a period of two years and will
be transferred to a separate dormant / inoperative account status in the interest
of the depositor as well as the Bank. The depositor will be informed of charges,
if any, which the Bank will levy on dormant / inoperative accounts. The
depositor can request the Bank to activate the account for operating it. If a fixed
Deposit Receipt matures and proceeds are unpaid, the amount left unclaimed
with the bank will attract Savings Bank Rate of Interest. Bank will pay interest at
Savings Bank Rate (presently 4.00% p.a.) on maturity proceeds of term
deposits
withdrawn (without being renewed) after the due date by the
depositors.
32. Information to depositors:
Bank's policy relating to opening and maintenance of deposit accounts and the
various charges on such accounts and the revisions in such policy and the
charges, will be informed to the depositors in the following manner.

The terms and conditions for opening a deposit account and the charges that
will be levied on the account will be provided to the customer at the time of
opening of the account. The charges that are levied are variable. Customers
will be informed about the terms and conditions, revised charges etc from
time to time.
In case of any revision, the revised policy / requirements and revised charges
will be displayed at prominent places in branches.
Additionally, depositors will be informed about the revised policy /
requirement / charges either through press releases or advertisement in print
media and/or by displaying on Bank's web site www.andhrabank.in

All interest rates on Domestic and Non Resident Deposits are displayed at
prominent places in branches and also Bank's website www.andhrabank.in.
33. Standing Instructions:
Standing instructions can be given to the Bank for transfer/remittance of funds
from one account to other account(s) maintained in the same branch, or any
other branch of the bank or any other bank or any other third party. Applicable
charges will be levied by the bank for rendering the said services. Revision in
service charges, if any, will be communicated one month in advance to all
customers before effecting the revision, through Bank's website. Transfer of
funds through standing instructions in NRE/NRO is subject to guidelines given by
FEMA/RBI from time to time

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34. Redressal of complaints and grievances:

Depositors having any complaint / grievance with regard to services rendered by
the Bank have a right to approach authorities designated by the Bank for
handling customer complaints / grievances. The details of the internal set up for
redressal of complaints / grievances will be displayed in the branch premises.
The branch officials shall provide all required information regarding procedure
for lodging the complaint. In case, the depositor does not get response from the
Bank within one month from the date of complaint or he is not satisfied with the
response received from the Bank, he has a right to approach Banking
Ombudsman appointed by the Reserve Bank of India.
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