The correct answer is Allowed up to four nominees. Explanation & Key Takeaways: • The Banking Laws (Amendment) Act, notified in April 2025, introduced a significant reform by allowing bank account holders to have up to four nominees for a single account. • Previously, under the Banking Regulation Act, 1949, depositors were permitted to nominate only one individual to receive the proceeds of their deposits in the event of their death. • This amendment provides depositors with the flexibility of simultaneous and successive nominations. This means they can specify the proportion of funds each nominee should receive or list them in a preferred order of succession. • The primary objective of this change is to reduce the volume of unclaimed deposits in the Indian banking system, which has been a growing concern for the Reserve Bank of India (RBI). • By allowing multiple nominees, the government aims to ensure a smoother transition of assets to legal heirs or beneficiaries, thereby minimizing legal disputes and administrative hurdles for families of deceased depositors. Hence, the correct answer is Allowed up to four nominees. Related Concepts: • Scope of the Amendment Act: • The Banking Laws (Amendment) Act amends several key legislations, including the Banking Regulation Act, 1949, the State Bank of India Act, 1955, and the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980. • Apart from nomination rules, it seeks to improve governance standards in the banking sector and provide greater operational freedom to banks. • Changes in Substantial Interest: • The Act revised the definition of substantial interest for bank directors. The threshold, which was previously fixed at Rs. 5 lakhs in 1968, has been significantly increased to Rs. 2 crores to reflect modern economic realities. • Cooperative Bank Reforms: • The amendment extended the tenure of directors (excluding the chairman and whole-time directors) in cooperative banks from the existing 8 years to 10 years. • This change aligns the management of cooperative banks with the standards applicable to other commercial banking entities. • Unclaimed Deposits and UDGUM: • To tackle the issue of forgotten funds, the RBI previously launched the UDGUM (Unclaimed Deposits – Gateway to Access Information) portal. The 2025 notification on multiple nominees complements these digital efforts to return funds to the rightful owners. Important Notes: • Auditor Remuneration: The Act grants greater autonomy to the boards of directors of public sector banks to determine the remuneration of statutory auditors, which was earlier more tightly regulated. • Reporting Dates: It updated the reporting frequency for banks to the RBI from a fortnightly basis (Fridays) to a daily or specific date basis to ensure more accurate liquidity management and data tracking. • Customer Protection: The increase in the number of nominees is seen as a pro-consumer move, particularly for large families or individuals wishing to distribute their savings among multiple dependents without requiring a complex Will. • Notification Year: While the bill was tabled in 2024, its implementation and notification occurred in April 2025, marking a new era in Indian banking jurisprudence.