Duties & rights of a banker and customer rights
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 65 rapid-fire Q&A cards.
What is the primary duty of a banker towards a customer regarding account information?
A banker has a strict duty of secrecy and must not disclose any information about a customer's account to any third party without the customer's consent, legal compulsion, or public duty.
What is the banker's duty of secrecy as established in the Tournier v National Provincial Bank case?
Bank must not disclose customer information to third parties.
Under which circumstances can a bank legally disclose customer information without consent?
A bank can disclose customer information under compulsion of law (court orders, RBI/IT authorities), duty to the public (fraud prevention), bank's own interest (recovery proceedings), or with express/implied customer consent.
What is the duty of a banker when a customer countermands payment of a cheque?
Bank must stop payment immediately upon receiving valid countermand.
What does the 'duty to honour cheques' mean for a banker?
A banker is bound to honour all cheques drawn by a customer on their account as long as there are sufficient funds, the cheque is properly drawn, and no legal bar (such as a garnishee order) exists.
What is the banker's right of lien on goods or securities left with the bank?
Bank can retain securities until dues are paid by customer.
What is a garnishee order and how does it affect a banker's duty?
A garnishee order is a court order attaching funds in a debtor's bank account; upon receipt, the banker must stop payment on cheques to the extent of the attached amount and hold the funds for the court.
What is the customer's right to receive credit for cheques deposited in the bank?
Customer is entitled to credit only after cheque is cleared.
Video classes for this chapter
Duties & rights of a banker and customer rights
Duties & rights of a banker and customer rights
Duties & Rights of a Banker and Customer Rights
Duties & rights of a banker and customer rights
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