• Nominee Vs Legal Heirs for Fixed Deposits

    Picture a scenario where a considerable sum of money has been invested in a fixed deposit. A nomination has also been made. Sometime later, the depositor passes away and the money in the fixed deposit is given to the nominee. Everything seems to be going well, when suddenly, someone comes forward claiming they are the deceased person’s legal heir and that they are entitled to the money given to the nominee. The matter goes up in front of a judge and the judge rules that the money, assuming the claimant was indeed the depositor’s legal heir, goes to the legal heir. How did this happen?

    It may come as a surprise to you but a nominee, in fact, is not the same thing as a legal heir and the claim of a legal heir supersedes that of the nominee. Confused? Don’t worry, there is an explanation to support this.

    What is a nominee?

    Technically speaking, a nominee is just a custodian. They are people on whom falls the responsibility of ensuring that the legal heir of the depositor gets the money from a fixed deposit. While there may be times when the nominee is the same as the legal heir, their status as nominee means that they don’t really ‘own’ the money.

    What is a legal heir?

    A legal heir, simply put, is a person defined by a will and testament as the person who should receive the benefits of the deceased’s estates and, in this case, the money from the fixed deposit.

    But what happens if no will has been created?

    In such cases, legal heirs may be decided based on prevailing laws of inheritance in India. This means that the decision will be made based on the Hindu Law or the Muslim law, etc.

    Defining who gets the maturity proceeds

    The answer to this question is painfully simple. Make a will!

    Some people assume that making a will is an archaic practice and that a nomination is enough to ensure that the money goes where you want it to, but they are wrong. The contents of a will always supplant any claims made by anyone else. If you want to ensure that the nominee gets the benefits, mention it clearly in the will.

    What happens in case there are no instructions left behind?

    Wills and nominations are all fine but what happens if the deceased left no instructions about what was to be done with the fixed deposit in the event of their death?

    There are two things that may happen in such a case. First, the bank will try and get in touch with someone related to the deceased deposit-holder. Second, and more likely, is that, in case no one can be reached, the bank will reinvest the fixed deposit or park the money till such time as someone claims it. If someone does come forward to claim the amount, they will be asked to prove their relationship with the depositor before getting access to the FD funds.

    Where do the banks fit into all this?

    You might be wondering, if a nominee is not the legal heir then why would the bank hand over the FD proceeds to him/her?

    The answer to this is that the bank’s responsibility ends with paying out the fixed deposit proceeds to the stated nominee. If a nominee was named then the money goes to the nominee else to a proven legal heir. Once the FD is handed over to the nominee, its distribution is the responsibility of the nominee and not the banks.

    The exception to the rule

    Every rule has an exception and this rule is no different.

    As per the rules, people who can actually ‘own’ the inheritance are the legal heirs and not nominees. The exception comes in when dealing with shares. If a person has been named the nominee to certain shares, they actually ‘own’ those shares until or unless a will is produced which supersedes the nomination.

    Have you ever seen a family dispute over the estate of a recently deceased member of the family? It’s never a pretty sight and in most cases onlookers wonder why the dispute even exists since the person clearly named A or B to be the nominee. Now that you know one of the reasons these disputes exist ensure you make a will that clearly states who receives the fund and spare your loved ones the headache of battling it out in court.

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    Nominee Vs Legal Heirs for Fixed Deposits Reviews

    • ICICI Bank Fixed Deposit
      "Customer centrice & User friendly app"
      0.5 4.0/5 "Great!"
      I am doing Fixed Deposit with ICICI BANK and its been around 5years. They haven't been paying good interest and its more or less same like other banks as I used to hold my salary account with ICICI, I have decided to be with one bank. There is no locking period and its flexible. They do give good support and the app is user friendly. Even deposit account can be opened through i-mobile or net banking itself.
      Was this review helpful? 0
      , nasik
      Reviewed on Oct 15, 2019
    • SBI
      SBI Fixed Deposit
      "Good"
      0.5 3.0/5 "Satisfactory"
      I had a Fixed Deposit in State Bank of India, I have completed the tenure before 3months ago. I have no issues with the customer service. They are given me 7% interest rate for 2years. There is no profit and processing fee. I got an online access, where I can check the interest rate anytime on the YONO app or else SBI online.
      Was this review helpful? 1
      , tirupati
      Reviewed on Oct 15, 2019
    • SBI Fixed Deposit
      "Interest charges are good. "
      0.5 3.0/5 "Satisfactory"
      I have invested some money through FD. My salary account is in SBI so i have a zero ATM charges and the limit is not actually set by SBI. They do have short term FDs which is pretty good. I have invested the money of Rs. 60000 and the interest rate is 10.01% for the tenure period of 16 months. There is no lockin period. There is no hassle to getting the money back.
      Was this review helpful? 7
      , kolkata
      Reviewed on Oct 01, 2019
    • Dena Bank Fixed Deposit
      "Good plan for senior citizen"
      0.5 2.0/5 "Expected more"
      I have invested the money in Dena bank through Fixed deposit and the growth is not that much good. They are not taking any hidden charges. Only because of the Government undertaken bank, i have selected them. They are providing a interest rate of 6% per annum. I have invested the money of Rs. 2 lakhs. There is a lockin period of 1 year.
      Was this review helpful? 3
      , new delhi
      Reviewed on Sep 24, 2019
    • Axis Bank Fixed Deposit
      "Interest should be increased for FD"
      0.5 3.0/5 "Satisfactory"
      I have opt for fixed deposit for the tax saving purpose because I have chosen five years tenure with AXIS Bank, still its going on. Only once I Invested my money it has the locking period of five years. I have option to check my transactions through mobile app. But I have concern about the interest rate is very lesser for this FD.
      Was this review helpful? 5
      , hyderabad
      Reviewed on Sep 19, 2019
    • SBI Fixed Deposit
      "FD process should be simpler"
      0.5 1.0/5 "Really Bad"
      I had fixed deposit with SBI then I withdrawn the amount, I done Rs. 3 lakhs of investment on my daughter name then I taken the liquidity to purchase the land, at the time I struggled a lot to take that money because the process was difficult to withdrawn the money after seven months of tenure.
      Was this review helpful? 15
      , madurai
      Reviewed on Sep 03, 2019
    • Union Bank of India Fixed Deposit
      "Not good"
      0.5 3.0/5 "Satisfactory"
      I had a Fixed Deposit with Union Bank of India and its closed 18 to 19 months due to personal reasons. I am doing investment but my experience is not good with FD account. In my home town, there is no other banks so just decided to go with this bank. The returns are good.
      Was this review helpful? 7
      , bangalore
      Reviewed on Aug 28, 2019
    • HDFC Bank Fixed Deposit
      "Good to go with HDFC"
      0.5 5.0/5 "Blown Away!"
      I have one FD with HDFC, I deposited Rs. 1 lakh, I was opt for 45 days of tenure. Finally I got 6.25% of interest for 45 days. It won't cover the tax, if we need tax benefits we should go for five years term. I can track the details through netbanking, on the maturity date the amount credits automatically in the account. Even the notification can customized.
      Was this review helpful? 8
      , bangalore
      Reviewed on Aug 27, 2019
    • HSBC Bank Fixed Deposit
      "wrong calculation of interest rates"
      0.5 0.5/5 "Unacceptable"
      HSBC staff wrongly pre closed my fixed deposit .. and calculated the interest rates wrongly and when asked them for clarification never got back .. even after following up with them repeatedly for more than 3 months.. would highly recommend not using their services.
      Was this review helpful? 4
      , visakhapatnam
      Reviewed on Aug 24, 2019
    • SBI Fixed Deposit
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      I do have a Fixed deposit account with SBI and it was carried out by Mom and even I have account for my daughter. Its still running and they have Google application separately to access online. The returns are good. I am doing monthly investment and it was opened quite a long may be 4 years.
      Was this review helpful? 9
      , ahmedabad
      Reviewed on Aug 23, 2019
    • ICICI Bank Fixed Deposit
      "Good"
      0.5 5.0/5 "Blown Away!"
      I just opened a Fixed Deposit with ICICI BANK and have not done any survey on this. I am account holder with them so it was easy to do FD account even they are providing 7% interest rate. The process is very user friendly and never faced any hassle. I could access this account via online.
      Was this review helpful? 6
      , new delhi
      Reviewed on Aug 21, 2019
    • Post Office Fixed Deposit
      "Good for future"
      0.5 3.0/5 "Satisfactory"
      In post office rate of interest is higher for the fixed deposit when compared to the bank, I invested Rs. 5000 on monthly basis its comes in a year Rs. 60,000 after 5 years I got Rs. 3.75,000 I got Rs. 75,000 extra. The service is not comfortable if we have any relative who working there it would supportive or else difficult.
      Was this review helpful? 17
      , burdwan
      Reviewed on Aug 09, 2019
    • SBI Fixed Deposit
      "Good for future saving"
      0.5 5.0/5 "Blown Away!"
      I have FD with SBI, I have opt for one year term there is no such limitation for depositing the money. The interest rate is good for the FD, the online banking is convenient to take liquidity. They resolve the queries on time. Its most safe and secured.
      Was this review helpful? 4
      , visakhapatnam
      Reviewed on Aug 08, 2019
    • SBI Fixed Deposit
      "Average"
      0.5 4.0/5 "Great!"
      I have selected state bnak of indis fixed deposit amount 1 lakhs , Tenure 5 years and Rate of interest 8 percentage after renewal fixed deposit 6 percentage is very less .while document directly bank . Customer service is not good and responsive.
      Was this review helpful? 8
      , kochi
      Reviewed on Aug 05, 2019
    • Kotak Fixed Deposit
      "Excellent Banking"
      0.5 5.0/5 "Blown Away!"
      I activated FD account with Kotak, I have been maintaining this account since when I opened saving account, I converted Rs. 5000 for one year. They are providing interest around 7.6% per annum, the online netbanking and mobile app is very convenient for deposit to FD.
      Was this review helpful? 5
      , mumbai
      Reviewed on Aug 03, 2019
    • ICICI Bank Fixed Deposit
      "Good"
      0.5 4.0/5 "Great!"
      I have invested my FD with ICICI BANK and also have a 3in1 account with them. The interest rate is pretty good. Recently started before 6months, I can do premature withdrawal and also have selected a locking period of 3 years. The customer service is good and overall am satisfied with this bank.
      Was this review helpful? 4
      , mumbai
      Reviewed on Aug 01, 2019
    • Post Office Fixed Deposit
      "Safe and Secured"
      0.5 4.0/5 "Great!"
      My Post office branch is located in own campus hence there is no queue. I opened the fixed deposit, I made one time investment for five years its has tax exemption. They are providing 7% of interest for per annum. I believe it has online access as well.
      Was this review helpful? 13
      , bangalore
      Reviewed on Aug 01, 2019
    • SBI Fixed Deposit
      "Too much good scheme"
      0.5 5.0/5 "Blown Away!"
      Chosen my fixed deposit from State bank of India. I have invested the money of Rs. 57000 and SBI is a most popular bank all over the India and offering all the facilities compared to bank. Since i have a salary account with them, its easy to transfer the money. They are providing the interest rate of 6.5%.
      Was this review helpful? 7
      , kolkata
      Reviewed on Jul 31, 2019
    • Union Bank of India Fixed Deposit
      "Good Investment"
      0.5 4.0/5 "Great!"
      Union of India fixed deposit is same as other investment. Being an existing customer I have opt for one year of fd, the online banking feature is good to open and closing the account, they was no charges for the liquidity of fund before the maturity.
      Was this review helpful? 3
      , mumbai
      Reviewed on Jul 29, 2019
    • SBI Fixed Deposit
      "Good investment plan"
      0.5 4.0/5 "Great!"
      Chosen my fixed deposit from state bank of India because the given rate of interest is high. They are not deducting any service charges. I have invested the money of Rs. 1 lakhs and there is no lockin period and i have chosen the plan for 1 year and they are giving a interest rate of 6.75%.
      Was this review helpful? 11
      , bangalore
      Reviewed on Jul 25, 2019
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