RBI Empowers Kids Aged 10+ to Open and Operate Bank Accounts Independently
In a major step toward financial inclusion and early financial literacy, the Reserve Bank of India (RBI) has issued fresh guidelines allowing children aged 10 years and above to independently open and manage their own savings and term deposit accounts.
The guidelines, released on April 21, 2025, mark a transformative shift in how Indian banks engage with young customers, promoting responsible money habits from an early age.
Key Highlights:
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Accounts at Any Age: Banks may open minor accounts at any age through a natural or legal guardian. RBI reiterated that mothers may act as legal guardians, reinforcing a standing guideline from 1976.
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Independent Access from Age 10: Children above 10 years of age can operate accounts on their own—within limits set by each bank based on internal risk policies. These conditions must be made transparent to young account holders.
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Full Control at 18: Upon reaching adulthood, account holders must submit fresh operating instructions and verify balances if previously managed by a guardian. Banks are instructed to ensure a smooth transition.
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Modern Banking Access: Banks may offer internet banking, ATM/debit cards, and cheque books to minor account holders, as long as it’s within their risk framework.
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No Overdrafts: Minor accounts—whether operated by the child or a guardian—must stay in credit. Overdrawing is strictly prohibited.
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KYC Compliance: All minor accounts must adhere to KYC norms as per RBI’s Master Direction on KYC, 2016.
These changes apply to all commercial banks, urban co-operative banks, state co-operative banks, and district central co-operative banks. Institutions must update their internal policies by July 1, 2025 to stay compliant.
The move has been welcomed by educators and financial literacy advocates, who believe it will equip children with essential money management skills early on in life.
