The Banking Laws (Amendment) Act, 2025, which came into force on 1 November 2025, has significantly transformed estate planning for Indian families. According to reports from Mint, this legislation addresses the decades-old single-nominee limit that previously forced families to open separate accounts or safety lockers to name different beneficiaries. The new framework now permits up to four nominees for a single bank account or locker, eliminating the previous restriction that created administrative complications when sole nominees passed away.
For savings and fixed deposit accounts, the new law provides two simple nomination methods. As reported by Mint, simultaneous nomination allows parents to name up to four people (such as spouse and children) and specify exact percentage allocations for each beneficiary. Alternatively, successive nomination enables listing up to four people in order of priority, with banks distributing funds only to the second person if the first passes away before the account holder. For lockers and physical items, successive nomination is mandatory since banks cannot physically divide and distribute items like gold necklaces or family heirlooms.
Banks process transactions primarily based on account numbers rather than beneficiary names, though some institutions may flag mismatches for security checks. According to Bank of Baroda guidance, for recurring or NEFT/RTGS transactions, adding beneficiaries is required for security and traceability purposes. The bank allows customers to add multiple beneficiaries with no strict limit for most accounts, though specific account types may have caps on the number of beneficiaries. After adding new beneficiaries, banks generally enforce a cooling period of 30 minutes to 24 hours before the first transfer can be made to enhance security and prevent unauthorized transactions.
For international transactions, international beneficiaries can be added for outward remittances using SWIFT or foreign transfer channels, requiring the beneficiary's bank details including account number, SWIFT/IFSC code, and country information. Despite the new nomination flexibility, legal experts emphasize that nominations should not replace comprehensive estate planning. According to The Victoriam Legalis analysis reported by Mint, the distinction is crucial where intended beneficiaries differ from nominees, with Section 45ZA(4) of the Banking Regulation Act, 1949 preserving rights and claims that other persons may have against the bank's payment recipient.
