Opening Accounts of Various Customers
Account opening rules: individuals, joint accounts, illiterate (no current A/c, no cheque book), blind, minors (10+ can operate SB), HUF (Karta, coparceners), proprietorship (no SB in firm name), partnership (death dissolves, Sec 4 IPA 1932), LLP (DPIN), companies (resolution, MoA/AoA), trusts, cooperatives. LEI: 20-digit code.
Banky Opens All Types of Accounts! 📂
Every day you’ll open accounts for individuals, companies, partnerships, trusts, and more. Each type has different rules, documents, and operations. Get any of these wrong and you face audit observations or legal trouble!
Why Read This Chapter?
Opening the right type of account with correct documents = zero audit exceptions
Exam Marks
3-5 questions — introduction not to be taken (not compulsory!), minor for whom court appoints guardian = majority at 18, minor’s account guardian = mother or father, partnership min 2 adults, HUF Karta. Very high weightage!
Career Growth
Account opening is the FIRST thing you do at a branch — errors here ripple through everything
Real Life
You’ll know exactly how to open accounts for your family’s HUF, partnership business, or child’s savings
How Will It Benefit You?
Real career advantages
What Is This Chapter About?
30-second summary
Key Definitions — Banky Asks, Mentor Explains
Every term explained like you’re 10
Banky’s Understanding: Individual account: must be major (18+), sound mind, competent to contract. Introduction NOT to be taken (exam PYQ! — replaced by KYC). Account opening form = contract between bank and customer. KYC/CDD as per CKYCR forms. Guardian signs for minors/incapacitated. Joint accounts: two or more individuals, mode of operation specified (jointly/E or S/A or S/Former or Survivor). KYC for ALL joint holders.
Banky’s Understanding: Illiterate: NO current account. NO cheque book (even in joint A/c). Left thumb impression + bank officer + witness attestation. Passport photo on A/c form + passbook. Every withdrawal: oral confirmation. Can authorise literate person: JOINTLY only (not E or S or alone). Blind: No legal bar. Extra care (signature may be inconsistent). Signature + thumb impression if inconsistency noticed. Entries read out. Branch Manager can allow self-operation.
Banky’s Understanding: Minor: Person below 18 years (Indian Majority Act 1875). Court-appointed guardian → also majority at 18 (exam PYQ!). Banks decide minimum age for independent operation (typically 10+ years). Minor can draw/endorse/negotiate NI under Sec 26 NI Act. NO overdraft. Guardian = mother or father (exam PYQ! — natural guardian). Death of guardian → balance paid to minor after majority. On majority: fresh confirmation, new specimen signature, fresh operating instructions.
Banky’s Understanding: HUF (Hindu Undivided Family): Business is inheritable. Karta (eldest male) manages. Since 2005 Hindu Succession Amendment: daughters are coparceners too. Delhi HC: eldest female can be Karta. All adults sign A/c opening form. Karta has implied authority to borrow. Minor coparceners: guardian signs. Withdrawal of coparcener ≠ dissolution. Death of Karta → next senior coparcener becomes Karta (exam PYQ!).
Banky’s Understanding: Proprietorship: Treated as individual. NO savings A/c in firm name. No separate incorporation. Proprietor signs everything. Partnership: Sec 4 Indian Partnership Act 1932. Registration optional (except Gujarat/Maharashtra). All partners sign partnership letter. Death of partner dissolves firm — stop A/c operations immediately! Retirement → new A/c. No partner can open bank A/c in own name for firm. Clayton’s rule applies (new credits reduce oldest debits).
Banky’s Understanding: LLP: LLP Act 2008. Min 2 Designated Partners with DPIN. Small LLP = contribution ≤₹25L, turnover ≤₹40L. Corporate person — not affected by partner changes. Partners NOT personally liable. Resolution by Designated Partners. Company: Public (min 7 members), Private (2-200), OPC (1 person). Documents: Board Resolution + MoA + AoA + Certificate of Incorporation + PAN. Company is separate legal entity (Salomon vs Salomon case).
Banky’s Understanding: LEI (Legal Entity Identifier): 20-digit alpha-numeric code to uniquely identify parties to financial transactions globally. Issued by LEIL (subsidiary of CCIL), accredited by GLEIF. Mandatory for: ₹50 Cr+ NEFT/RTGS transactions, ₹5 Cr+ borrowers (aggregate exposure), OTC derivatives participants. No new exposure without LEI. Govt departments (not PSUs) exempt.
Banky’s Understanding: Prior to KYC guidelines (2002), banks required introduction from existing account holder. After RBI KYC guidelines: introduction NOT to be taken (exam PYQ! — answer is ‘not to be taken’, not optional/compulsory/discretionary). KYC/CDD process replaced the need for introduction. Banks should NOT deny accounts due to lack of introduction.
Chapter Explained in Simple Stories
So easy even Banky’s nephew understands
📂 Block 1: Individuals, Minors & Special Accounts
Introduction: NOT to be taken (exam PYQ! — KYC replaced introduction).
Minor: 10+ can operate SB independently. Guardian = mother/father. Sec 26 NI Act (draw/endorse). No overdraft. Court guardian: majority at 18. On majority: fresh confirmation + specimen signature.
Illiterate: NO current A/c, NO cheque book. Thumb impression + witness. Withdrawal: oral confirmation.
Blind: No legal bar. Signature + thumb if inconsistent. Entries read out.
🏢 Block 2: HUF, Partnership, LLP & Companies
HUF: Karta operates. All adults sign. Daughters = coparceners (2005). Death of Karta → next senior coparcener.
Proprietorship: NO savings A/c in firm name. Treated as individual.
Partnership: Sec 4 IPA 1932. Registration optional (except Gujarat/Maharashtra). Death of partner → firm dissolves → stop A/c!
LLP: DPIN for partners. Small LLP: ₹25L/₹40L. Partners not personally liable.
Company: Resolution + MoA + AoA + CoI. Public 7+, Private 2-200, OPC 1.
LEI: 20-digit code. ₹50 Cr+ NEFT/RTGS. ₹5 Cr+ borrowers.
Exam Angle — Every Testable Point
All facts, numbers, definitions JAIIB tests
✅ Must-Know Facts — Highest Probability
- Introduction while opening accounts = NOT to be taken (not optional/compulsory!)
- Minor for whom court appoints guardian = majority at 18 years (not 21!)
- Minor’s account guardian = mother or father (natural guardian)
- Minor aged 10+ can operate SB account independently (Sec 26 NI Act)
- Illiterate: NO current account, NO cheque book — thumb impression + witness
- HUF: Karta operates | Death of Karta → next senior coparcener becomes Karta
- Daughters are coparceners since 2005 Hindu Succession Amendment
- Proprietorship firm: NO savings account in firm name — treated as individual
- Partnership: Sec 4 Indian Partnership Act 1932 | Registration optional (except Gujarat/Maharashtra)
- Death of partner DISSOLVES partnership — stop account operations immediately!
- Partnership: min 2 persons to open account — both must be adults (exam PYQ!)
- LLP: LLP Act 2008 | DPIN for Designated Partners | Small LLP: ₹25L contribution + ₹40L turnover
- Company: Board Resolution + MoA + AoA + CoI + PAN | Public 7+, Private 2-200, OPC 1
- LEI: 20-digit alpha-numeric | ₹50 Cr+ NEFT/RTGS | ₹5 Cr+ borrowers | Issued by LEIL (CCIL subsidiary)
- Photographs: Pardanashin women also | HUF = Karta’s photo | Minor 10+ = minor’s photo
- No account in benami name | CDD for ALL joint holders
📝 Previous Year Questions
Memory Tricks That STICK
Lock every fact permanently
🧠 Trick 1 — Intro NOT Taken
🧠 Trick 2 — Minor 10+ Operates SB
🧠 Trick 3 — Court Guardian = 18
🧠 Trick 4 — Death Dissolves Partnership
🧠 Trick 5 — Proprietorship ≠ SB
🧠 Trick 6 — HUF Karta Succession
🧠 Trick 7 — LEI = 20 Digits
🧠 Trick 8 — Illiterate = No CA No CB
Visual Summary — Chapter Map
Entire chapter in one diagram
Flash Revision — Last-Minute Cards
Read these 10 minutes before exam
⚡ Chapter 4 Complete — Opening Accounts of Various Types of Customers
- Introduction: NOT to be taken | Minor: 10+ operates SB, Sec 26 NI Act, guardian=mother/father, majority 18
- Illiterate: no CA/cheque book | Blind: no legal bar | HUF: Karta, coparceners, daughters 2005
- Proprietorship: no SB in firm name | Partnership: death dissolves, Sec 4 IPA 1932
- LLP: DPIN, LLP Act 2008 | Company: resolution+MoA+AoA+CoI | LEI: 20-digit, ₹50Cr+
Banky says: “Intro NOT taken, minor 10+=SB, HUF=Karta, death=dissolves partnership, LEI=20 digits!” 🎉📂
You now know how to open accounts for EVERY type of customer — from minors to companies. Zero audit exceptions ahead! 💪