No Restrictions on Opening Joint Bank Accounts for LGBTQ Persons: Govt
Moneylife Digital Team 30 August 2024
Persons from the queer community (lesbian, gay, bisexual, and transgender -LGBT community) can open joint bank accounts and also nominate a person in the queer relationship as a nominee for the account, the Union government says. 
                               
In an advisory, the Union ministry of finance says, "There are no restrictions for persons of the queer community to open a joint bank account and also to nominate a person in the queer relationship as a nominee to receive the balance in the account in the event of the account holder."
 
The advisory from the ministry comes following the 17 October 2023 order of the Supreme Court in the case of Supriyo@Supriya Chakraborty and another vs Union of India.
 
According to the advisory, last week, the Reserve Bank of India (RBI) also issued a clarification to all scheduled commercial banks (SCBs) on the opening of joint accounts by persons from the queer community.
 
On Wednesday, KV Kamath, renowned banker and non-executive chairman of Jio Financial Services, released Moneylife Foundation's report on "Challenges in Transmission of Assets to Nominees and Legal Heirs". 
 
The report revealed that over Rs2 lakh crore of unclaimed assets remain in limbo with the government and financial regulators, growing at 15%-20% annually. 
 
Among the challenges that nominees and legal heirs face when claiming assets of the deceased are inconsistent processes for nomination, lack of standard operating procedures, poor searchability of data, lack of knowledge and harassment by officials which lead to unreasonable delays in settlement of claims. 
 
The report release was followed by a panel discussion moderated by senior journalist Sucheta Dalal, who is also the founder trustee of Moneylife Foundation.
 
Responding to a question about whether nominations with safeguards can help ease the asset transmission process, Harsh Roongta, founder of Fee Only Investment Advisers, says, "People have an aversion to writing Wills…but asset-wise nomination is much easier to digest for Indians. This is why in my opinion nominations should supersede Wills."
 
"Can nomination replace a Will? Yes perhaps in financial assets…but it is much more complicated for immovable assets," opines advocate Joby Mathew, former legal officer of SEBI and founder of Joby Mathew & Associates.
 
"By making a nomination you are basically telling the world that this is the person whom your assets should pass on to. That is essentially what a Will does, with the addition of a probate in presidency towns," he added.
 
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