The opening of an account by a customer with a banker creates an obligation on the banker towards its customer in respect of certain rights and responsibilities. Those rights and responsibilities are also known as “Special Features of Relationship between a Banker and Customer”.
How will be the relationship of banks with their customers?
Answer: THE LEGAL RELATIONSHIP BETWEEN A BANK AND A CUSTOMER IS BASED ON CONTRACT AND IS GENERALLY CLASSIFIED AS A DEBTOR CRIDETOR RELATIONSHIP. THIS MEANS THAT WHEN A BANK OR ANOTHER TYPE OF ADI ACCEPTS MONEY FROM A CUSTOMER IT DOES SO AS A BORROWER ON TERMS THAT MAY BE IMPLIED.
What is the most important relationship between banker and customer?
As a customer must be an account holder, the basic relationship between banker and customer is that of DEBTOR AND CREDITOR, the banker being the debtor with regard to funds deposited with him, and being the creditor in respect of money lent by him.
Who is called as a banker?
BANKER, com. law. A banker is one engaged in the business of receiving other persons money in deposit, to be returned on demand discounting other persons’ notes, and issuing his own for circulation. One who performs the business usually transacted by a bank. Private bankers are generally not permitted.
Who are the special types of customers?
Special Type of Customers
- Lunatics.
- Illiterate persons.
- Married women.
- Executors and administrators:
- Trustees.
- Joint accounts.
- Partnership firm.
- Joint stock companies.
Which of the following is a function of a bank?
Functions of a bank includes- providing project finance, selling mutual funds and deciding policy rates like Cash reserve ratio, repo rate, statutory rate, etc. A bank mainly functions two things- receive deposits and give loans. It also provide financial services such as wealth management.
What are the types of relationship between banker and customer?
Types of the Relationship between Banker and Customer. The relationship between banker and Customer are categorized into three; Relationship as debtor and creditor. Banker as a trustee. Banker as an agent. Other special relationship with the customer, obligations of a banker.
What does it mean to be a bank customer?
BANKER CUSTOMER RELATIONSHIP: It obviously means that to become a customer account relationship is must. Account relationship is a contractual relationship. Banking is a trust-based relationship. There are numerous kinds of relationship between the bank and the customer.
What kind of contract does a bank have with a customer?
Banks and their customers are continually entering into various contracts. These may include deposit taking and loan agreements. In loan agreements, the bank gives the money to the customer now in return for the customer’s promise to pay back in the future typically with interest.
Is the bank-customer relationship legal in the UK?
The special position held by banks and the size of their activities makes it essential to study the banker-customer relationship under English Law. This paper will aim to ascertain the legal nature of the banker-customer relationship, with emphasis on the United Kingdom. I will begin by looking at the definitions of a bank/banker as used in the UK.
