MUMBAI: With Friday being the deadline for updating 50% of locker agreements, banks are urging customers to sign the new contracts. However, the process has become burdensome due to a lack of uniformity, not only across banks but even between branches.
Many bank branches are unprepared, lacking necessary documents for signing the agreements, despite customers being notified to visit and update these. Customers have expressed frustration over the inconsistency in stamp duty denominations between branches in the same state. While some public sector bank branches accept a Rs 100 stamp duty, branches of ICICI Bank, HDFC Bank and Axis Bank insist on a Rs 500 stamp paper.
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Following a 2021 Supreme Court order, the RBI instructed banks to have customers sign new contracts by January 2023. The RBI later called for a revision to the model agreement drafted by the Indian Banks Association, extending the deadline to December 2023. The revised agreement mandated that banks prevent fire, theft and building collapse while limiting their liability to 100 times the annual locker rent.
The directive stipulated that 50% of locker renters should sign the updated agreement by the end of June 2023. Customers who had previously signed agreements were required to sign supplements to their existing agreements.
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Furthermore, there is no standard practice regarding who bears the stamp duty. Most banks expect customers to bear the cost. SBI, however, stated it would cover the documentation expenses for the supplementary agreement.
“Indian Bank is requesting customers to bring Rs 500 stamp paper, while State Bank has provided only Rs 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 Rs 500 to Rs 1,000 as registration fees,” said Kedar Chandak, a bank customer from Mumbai.
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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. The bank clarified that if a modified agreement was submitted before February 28, 2023, customers must submit a re-modified/supplementary agreement due to the RBI’s revisions. The stamp duty, in this case, would be borne by the bank.
The bank emphasised the one-time registration fee applies only to new locker hirers. In addition, different practices are observed when customers are out of town. Ravi Agarwal, a Mumbaikar, has joint lockers with his son and daughter, who live in the US and the UK. Bank of Baroda is willing to accept signed documents, while a private bank insists on having their signatures certified at the Indian embassy.
