The deadline for updating 50% of locker agreements in Indian banks is today, and customers are being urged to sign the new contracts. However, the process has become a source of frustration due to a lack of uniformity not only across different banks but even between branches of the same bank.
One of the major issues customers are facing is the inconsistency in stamp duty denominations. While some public sector bank branches accept a stamp duty of ₹100, branches of ICICI Bank, HDFC Bank, and Axis Bank insist on a higher value of ₹500. This discrepancy has left customers confused and dissatisfied, as they expect a standardised approach across all branches.
“Indian Bank is requesting customers to bring ₹500 stamp paper, while State Bank has provided only ₹100 stamp paper for existing clients. In addition to the excess value of the stamp paper, Indian Bank is also charging its clients an additional ₹500 to ₹1,000 as registration fees,” said Kedar Chandak, a bank customer from Mumbai, as quoted by TOI.
Indian Bank responded, stating branches are instructed to collect only the required stamp duty amount according to state laws when customers submit the modified locker agreement.
Furthermore, many bank branches are unprepared for the signing process, lacking the necessary documents despite notifying customers to visit and update their agreements. This lack of readiness has resulted in delays and inconvenience for customers, who were expecting a smoother and more efficient experience.
The initiative to update locker agreements was prompted by a 2021 Supreme Court order, with the Reserve Bank of India (RBI) instructing banks to have customers sign new contracts by January 2023. However, the RBI later extended the deadline to December 2023 and called for a revision to the model agreement drafted by the Indian Banks Association.
The revised agreement mandates that banks take measures to prevent fire, theft, and building collapse, while limiting their liability to 100 times the annual locker rent. Additionally, it requires 50% of locker renters to sign the updated agreement by the end of June 2023. Customers who had previously signed agreements are also required to sign supplements to their existing agreements.
The lack of standardised practices regarding the payment of stamp duty has further compounded the issue. Most banks expect customers to bear the cost, while the State Bank of India (SBI) has stated it will cover the documentation expenses for the supplementary agreement.
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Updated: 30 Jun 2023, 08:29 AM IST