Quiz on Banking Laws (Amendment) Act, 2025

The Banking Laws (Amendment) Act, 2025 is Act No. 16 of 2025.

The President gave assent on 15 April 2025.

It amends five Acts: the RBI Act, Banking Regulation Act, SBI Act, and the two Banking Companies (Acquisition and Transfer of Undertakings) Acts.

Section 2 amends Section 42 of the Reserve Bank of India Act, 1934.

The Banking Regulation Act, 1949 is amended on these matters.

The Central Government may appoint commencement dates by notification in the Official Gazette, and different dates may be set for different provisions.

The previous threshold was ₹5 lakh, a limit that had remained unchanged since 1968.

The threshold was increased to ₹2 crore, or another amount that may be notified by the Central Government in the Official Gazette.

The increase updates a long-standing monetary threshold to reflect changing economic conditions and strengthens the relevance of governance rules.

The maximum tenure increased from eight years to ten years for directors covered by the provision.

The change excludes the chairperson and whole-time director.

The amendment‘s ten-year change is for specified cooperative-bank directors; tenure for directors in other banking companies remains unchanged under this amendment.

The change is intended to align cooperative-bank governance with the 97th Constitutional Amendment.

The amendment addresses the director of a central cooperative bank elected to the board of the state cooperative bank of which the central cooperative bank is a member.

A fortnight is the 1st through 15th of a calendar month, or the 16th through the last day of that month, inclusive.

The reference is replaced with ‘the last day of each fortnight‘.

The amendment changes the period from seven days to five days.

References to alternate Fridays and the last Friday are aligned with the last day of each fortnight or the last day, as applicable.

The amendments update the reporting framework used in relevant RBI and Banking Regulation Act provisions.

Sections 10 to 13 concerning nominations came into force on 1 November 2025.

The amendment permits up to four nominees, either simultaneously or successively, as applicable.

Deposit accounts may have simultaneous or successive nominations.

For articles kept in safe custody, successive nominations are permitted.

For lockers, the amendment permits successive nominations rather than simultaneous nominations.

The specified shares or percentages of entitlement must total 100%.

The second nominee becomes effective after the death of the first nominee.

The nominees are deemed to be nominated in the order in which their names appear in the nomination.

The provisions cover deposit accounts, articles kept in safe custody and safety lockers, with nomination options depending on the facility.

The amendment permits transfer of specified unclaimed amounts to the Investor Education and Protection Fund (IEPF).

The relevant amounts or shares are covered after seven years, subject to the applicable statutory conditions.

Shares are covered where dividends have not been paid or claimed for seven consecutive years.

The provision includes unpaid or unclaimed interest or redemption amounts on bonds issued by the corresponding new bank.

The transfer is to be made in accordance with rules under Sections 124 and 125 of the Companies Act, 2013, as referenced in the amendment.

The amendment permits the corresponding new bank to fix remuneration for its statutory auditors, replacing the earlier arrangement involving RBI consultation with the Central Government.

The amendment updates the reference from Section 226 of the Companies Act, 1956 to Section 141 of the Companies Act, 2013.

The DICGC Act, 1961 is not among the five Acts amended by this legislation.

The Act allows different provisions to commence on different dates through government notifications.

The Central Government appointed 1 August 2025 for Sections 3–5 and 15–20.

Sections 10–13 came into force on 1 November 2025.

The remaining specified provisions—Sections 2, 6–9 and 14—came into force on 15 December 2025.

The Act aims to strengthen governance, depositor and investor protection, audit quality and regulatory reporting.

The change is intended to support governance arrangements consistent with the 97th Constitutional Amendment.

The framework provides more flexible nomination choices and is intended to simplify claim settlement.

The provision aligns public sector bank practices with the Companies Act framework and supports formal handling of long-unclaimed amounts.

The Gazette of India and official Ministry of Finance/Department of Financial Services publications provide the primary statutory text and commencement notifications.