A Banker Customer relationship
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Principles and Practices of Banking — JAIIB.
One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What is the legal nature of the relationship between a banker and a customer when a deposit is made?
The relationship is that of a debtor and creditor, where the bank becomes the debtor and the customer becomes the creditor upon deposit of funds.
What type of relationship exists between a bank and a customer who has taken a locker for valuables?
Bailee and bailor relationship for the locker contents.
Who is considered a 'customer' of a bank under Indian banking law?
A customer is a person who has an account with the bank or is in the habit of dealing with the bank; even a single transaction can establish the relationship under certain circumstances.
What is the nature of banker-customer relationship when a bank issues a letter of credit?
Bank acts as an agent of the customer issuing the credit.
What is the primary relationship between a bank and its borrowing customer?
When a bank lends money, the relationship is reversed — the customer becomes the debtor and the bank becomes the creditor.
What is the minimum period of dealing required to qualify as a 'customer' of a bank?
No minimum period; even a single transaction can suffice.
Under what relationship does a bank act when it collects cheques on behalf of a customer?
The bank acts as an agent of the customer when collecting cheques, drafts, or other instruments on the customer's behalf.
What is the legal effect of a customer's death on the banker-customer relationship?
Death terminates the banker-customer relationship and mandate immediately.
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