Facebook, Twitter, WhatsApp generation now gets to open and operate a savings bank account all by themselves. Kids, that’s Young India (legally referred to as minors) can now operate a bank account with a cheque book, ATM/Debit card, net banking etc. Yes it’s true as per RBI’s directive children older than 10 years, that’s right 10 years! can open and operate a savings bank account independently. Banks are free to decide the terms and conditions but are advised to maintain safeguards such as not allowing overdrafts and keeping accounts in credit, Always!
This directive is in line with the policy of financial inclusion to bring in large sections of population into the banking system. Having a bank account may bring in financial discipline amongst the young with the habit of saving and investing for future goals. Banks can also tap this segment from an early age and bundle financial planning services to generate long term relationships. So, if you are a parent do not be surprised if your kids flash a debit card for their purchases or ask you to credit pocket money to their net banking account or offer to lend money to you for interest!!!
Banks are yet to devise and promote such products but the effect of such an offering remains to be seen. Only time will tell whether this move will result in financial inclusion, inculcate habit of saving and investment etc. But Young India should be happy and move towards financial independence.