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What to do with the savings account after the death of the account holder

Don’t withdraw money from the account. Inform the bank about the death and submit the required documents to get the balance transferred to your name.

Life is uncertain. No matter what you do and how careful you are, life has a way of sneaking up to you. And many of the important lessons that are required are not taught in schools and colleges. One of the important things is how to handle finance after a spouse passes away. One such area is the now-orphan savings account. A person is most likely to have more than one savings account. At the time of death, the bank accounts can have a substantial amount of money.

It is important to make sure that these accounts are handled as per the regulations. This will also make sure that there is no misuse of the bank account.    

Most family members know the bank account details including the ATM PIN. In case you may be tempted to withdraw the entire amount instead of going to a bank, but don’t. It is illegal to use deceased ATM card to withdraw money from their account. You can fall under serious trouble if the legal heirs or banks file a complaint with the police. You can be imprisoned or fined or both for three years under section 379 of IPC.

However, there can be a scenario where the owner and the nominee die. In case the legal heir will have the rightful claim on the savings bank account. For e.g., if the wife is the nominee of her husband’s bank accounts and both of them meet with a fateful accident. In this case, the children of the couple will receive the money lying in the savings account.

Here are the steps that you need to take after the death of the account holder:

Step 1 – Let the bank know about it

The first thing that you can do in this scenario is to approach the bank, meet the bank branch and let them know about the death. Ask them what needs to be done to claim to transfer the balance amount. They will most likely ask for proof.  Show them the death certificate. 

After they receive the request, the bank will make the account dormant. In this state, no withdrawals will be possible. However, the account may continue to receive deposits in the form of dividends. 

Step 2 – Submit all the required documents

After letting the bank know about the death, you have to submit additional documents so that the balance is transferred to your name.

The nature of this process will differ little based on the type of the account whether the bank account is single or joint savings account or whether the bank account has a nominee or not.

If it is solely held bank account then you as the nominee can approach the bank with the death certificate along with our identification proofs. After that, the procedure to transfer money to the nominee begins and the savings bank account(depending from bank to bank) remains in a dormant state for 6 to 12 months. 

Here are the documents that you have to provide to your bank:

  • Application, stating that the account holder has passed away,
  • Notarized death certificate
  • FIR copy (if the deceased has passed in the accident and body is missing for some time )
  • Authentic photo identification proof (such as Aadhaar card, pan card, driving license etc)
  •  Proof showing the relationship with the deceased
  • Nominee KYC documents (photo, pan card, and Aadhaar card)

If the bank account is a joint bank account and the primary bank account has passed away, then the second account holder has to inform the bank of the same so that the second bank account holder gets the right to access the amount.

In this case, here are the required documents:

  • Application stating the death of the 1st holder
  • Notarized death certificate of the 1st holder
  • FIR copy (if the 1st holder has passed in the accident and body is missing for some time)
  •  Authentic photo identification proof of the 2nd bank account holder

The transfer of the bank account becomes a tad more difficult if there is no nominee. If there is no mention of any nominee, the bank will require the written will to determine the rightful owner.

If the will is not present, then you have to bring a succession certificate from the court which will be taken a legal document and the money will be transferred to that bank account.

We hope that such a scenario does not take place in your life. But if it does, you will know what to do.

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