Bank Locker Rules and Regulations – Charges & RBI Guidelines

Bank locker is another ancillary product/service that banks provide to us. I always had a craze of accompanying my parents to the locker, where they would keep the important jewellery and documents, and there would be a heavy metal door with curtains.

But I had yet to get a locker for myself, and I did not know anything about it. So I decided to ask my friend Shivani, who is a banker by profession. She not only guided me on procedure of how to open a bank locker, but also explained me concepts linked with it.

How to open a bank locker in India – Procedure – SBI, ICICI, HDFC

So as Shivani told me, you don’t need to be a hot shot VIP customer of the bank to get a locker- you just need to have an account and be able to pay the annual rent of the locker. Walk into any branch of a public or private bank(be it SBI, ICICI or HDFC) where they have lockers and you will know the terms and conditions. However, let’s save you the trip and tell you right here.

Bank Locker Terms and Conditions

So here are the requirements/terms and conditions for opening a bank locker

A Saving account with the bank where you want to open a locker

This is probably the most important thing. Each bank needs you to open a savings account with them before they allot you a locker. And of course a saving account comes with the usual necessary documents- Aadhar Card, Pan card/Form 60- KYC (Know your customer) set of documents.

Bank locker agreement – is there any agreement?

Each bank has a custom made locker agreement which you have to agree to and sign thereof in order to get a locker in that bank. It includes an indemnity clause and is executed by a stamp paper (minimum value Rs. 100)

Annual rent in advance and deposit money

Banks ask you to pay the locker rent in advance, and also take a particular amount as deposit. Why do they do that? We will cover it later within this article.

These prerequisites are the same across different banks, the only difference arising on the account of locker rent, any other special terms and conditions to be fulfilled by the customer etc.

Bank locker charges comparison – SBI, ICICI , HDFC and Axis 

Here is charges comaprison on how much of rent/deposit etc is needed in order to open a bank locker in India- SBI and Axis Bank. ICICI bank and HDFC bank have different rates for different cities, and their charges can be confirmed by visiting the particular branch where you want to avail the locker.

Bank Locker Rules & Regulations

What is a locker service?

Let us first understand what the concept of a locker is. A locker is a metal locker that the bank allows you to keep your stuff in, in exchange for an annual fee. It is usually kept in strong rooms in the bank, with doors made of heavy metal.

Why would you want a locker?

You may wonder why people would prefer a locker and not keep them in home safes. The reason is simple- bank premises are a heavily guarded place- and the amount of protection a strong room door of a bank provides is not going to be affordable or even practical for an individual to install at his home. So lockers provide an element of safety in exchange for a fee. It is almost like not keeping cash at home and putting it in your bank account.

So when I pay fees for locker, am I hiring it, owning it or leasing it?

None of the above. When you take a locker, the relationship between you and the bank is that of a bailor and a bailee. To those who do not know- a bailor is one who gives his goods to someone else (bailee) to execute a service, while still retaining the ownership of the goods. For example, when you give your clothes for dry cleaning, the dry cleaning shop is your bailee and you are the bailor. Your goods are in his possession, but the ownership rests with you.

Similarly when you take a locker, your goods lying in the locker are essentially in the bank’s possession, but you retain their ownership.

It is to be noted here that even though the bank is a bailee, the bank does not have any knowledge of the contents of your locker and is responsible for the safety and security of the locker provided to you.

How many keys of the locker are issued to me?

The bank only issues one key to the locker hirer, even if the locker is taken out in a joint name. The key is a very vital part of the locker agreement, and is to be preserved carefully. If it is lost/misplaced/stolen, the customer has a duty to inform the bank immediately.

What happens when your bank locker key is Lost ?

If the key is lost, the bank breaks open the locker and recovers the costs of the same from the customer. Then a new lock is installed on the locker and a new set of keys are given to the customer.

What if I send my friend/family member with a key to operate the locker in my absence?

The bank will only allow the locker holder to operate the locker. Mere possession of the key will not allow access to the locker.

Can I take a locker jointly with more than one person?

Yes, You can take a locker jointly.

RBI guidelines for Bank Locker- Theft, FD and Insurance

Here are the RBI guidelines for bank locker regarding theft, fixed deposits and insurance:

What is a locker agreement? Is it necessary to sign one?

A locker agreement is an agreement between the locker hirer and the bank. It creates the relationship of bailor and bailee between the bank and the customer. In this the customer agrees to the basic terms of the contract- like not storing illegal items in the locker, regular payment of the dues in the locker etc. It is a mandatory document, varying slightly from bank to bank. You can say it is like the account opening form for a locker.

Bank locker nominee -Can a nominee be appointed for a locker?

Yes, and only one nominee can be appointed.

Is it necessary to buy an FD (Fixed Deposit)/Insurance for a locker?

As per RBI guidelines in this matter, banks cannot force a customer to buy FD in order from them to hire lockers. However, banks are allowed to take a caution money deposit- covering three years of advance rent and costs of breaking open of locker- from the customer. So more often than not it is suitable for the customer to take this in the form of FD, where it also keeps earning interest for him/her.

An insurance is not mandatory at all for opening a locker.

What if a robbery happens in a bank, or a theft where the lockers are compromised?

Are banks liable for locker thefts?

RBI in reply to an enquiry had made it clear that banks have no responsibility in case contents of a locker are compromised due to civil war, burglary or any other reason. The customer keeps his/her valuables in the locker at their own risk and the banks providing locker service cannot be held liable. Yes, that sounds a bit shocking but is true.

No, the banks are not liable for locker thefts.

Is it safe to keep jewellery in bank locker?

Yes it is safe to keep jewellery in locker but bank is not liable.

Who is liable for locker theft

Locker Operation and Break Open Procedure

Operation

A locker is opened by using two keys-

• One that is in the custody of the customer and
• Another one that is in the custody of the banker.

The locker will open only when both of these keys are used together. So a banker accompanies the customer to the locker room, puts in his keys along with the customers’ and opens the locker. Then he takes his key and leaves the room.

The locker can be closed by the single key only- which is in the possession of the customer.

A locker can be operated 12 times in a year by a locker holder. Beyond that, banks charge a fee per visit for operating the locker.

Locker Break open procedure

Locker is broken in rare circumstances like

• Death of the locker hirer without nomination, or
• Losing of the locker key, or
• Inactive locker for more than a specified period of time.

The procedure for  breaking open of a locker is done in the presence of the

• Customer/legal heir/nominee (as the situation may be)
• Advocate of the bank
• One witness (usually another customer of long standing and repute)

The breaking open is done by the company which has a contract with the bank for installation and upkeep of the lockers.

Can bank break open my locker without my consent?

Yes, in following cases

• If a court orders the bank to do so and take note of the inventory
• When the rent is not paid for more than a specified period of time despite repeated reminders and notices to the customers

Can Bank close your bank locker due to inactivity, even if rent is paid ?

If the locker is lying vacant for more than a specified period of time. For instance, in case of customers categorised as high risk (NRI customers etc). If the bank locker is not operated for more than a year it can be broken by the bank. This will happen even if rent is regularly paid on the locker.