Lok Sabha Passes Banking Laws Amendment Bill: A Major Shift

The Lok Sabha has approved the Banking Laws (Amendment) Bill, 2024, which includes provisions for up to four account nominees. Other changes aim to enhance governance, redefine directorship interests, and address concerns over privatization, cyber fraud, and KYC processes, while improving customer convenience and bank stability.

The Lok Sabha passed the Banking Laws (Amendment) Bill, 2024, on Tuesday, granting bank account holders the option of adding up to four nominees. The Bill, led by Finance Minister Nirmala Sitharaman, saw approval by voice vote.

Significant provisions include redefining 'substantial interest' in directorships, raising it to Rs 2 crore from the decades-old Rs 5 lakh, aiming to align with modern economic conditions. The Bill also proposes a longer tenure for directors of cooperative banks and offers banks greater flexibility in auditor remuneration.

Opposition parties expressed concern, with TMC's Kalyan Banerjee criticizing it as a step towards privatizing the banking sector. Key challenges such as cybersecurity and rigorous KYC processes were highlighted as issues needing immediate governmental action to safeguard consumers.

(With inputs from agencies.)