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Family Guide · October 2026

FD Nomination & Joint FD Rules 2026 — How to Make Sure Your FD Reaches Your Family

A missing nominee can keep your family's FD money stuck for months. Here's how the new 4-nominee rule, joint FD modes and the 15-day claim rule actually work.

Pramod Kumar By Pramod Kumar  ·  B.Tech NIT Nagpur | M.Tech IIT Roorkee | Founder, BookmyFD  ·  October 6, 2026  |  9 min read

Most of us spend hours comparing FD rates and about ten seconds on the nomination section of the form — if we fill it in at all. Yet that one line decides whether your family gets the money in about two weeks, or spends months collecting affidavits, indemnity bonds and court papers.

The rules have changed in a big way. Since 1 November 2025, banks let you name up to four nominees on a deposit. And under RBI's revised claim-settlement rules — which banks had to put in place by 31 March 2026 — a death claim must be settled within 15 days of the bank receiving the documents. This guide explains nominations, joint FDs and the claim process in plain language.

Person holding a savings jar — FD nomination protects family savings
A nominee makes sure your savings reach the right hands without paperwork delays.

📑 Table of Contents

  1. What Is FD Nomination — and Why It Matters
  2. The New Rule: Up to 4 Nominees on One FD
  3. Joint FD — Choosing the Right Operating Mode
  4. Nominee vs Joint Holder vs Legal Heir
  5. How to Claim an FD After the Depositor's Death
  6. No Nominee? The ₹15 Lakh Simplified Route
  7. Interest, Penalty and Tax After a Depositor's Death
  8. How to Add or Change a Nominee
  9. Smart Tips
  10. Frequently Asked Questions

1. What Is FD Nomination — and Why It Matters

A nomination is your instruction to the bank: "If I die, pay this FD to this person." The nominee can be any individual — your spouse, child, parent, sibling or even a friend. It costs nothing, takes a couple of minutes, and can be changed as many times as you like.

With a valid nomination on record, the bank can release the money on a simple claim form, the death certificate and the nominee's identity proof — no succession certificate, no court order, no surety.

💡 Banks must now offer you nomination Under RBI's 2025 nomination directions, a bank has to explain the facility when you open a deposit. You may decline, but only through a written declaration — and the bank cannot refuse or delay your FD because you didn't nominate. Once you nominate, the bank must acknowledge it within three working days and show "Nomination Registered" with the nominee's name on your FD receipt, passbook or statement.

2. The New Rule: Up to 4 Nominees on One FD

Until October 2025 you could name only one nominee per deposit. The Banking Laws (Amendment) Act, 2025 changed that. From 1 November 2025 you can name up to four nominees, in one of two ways:

FeatureSimultaneous NominationSuccessive Nomination
How it worksAll nominees share the money in the percentages you fixNominees are ranked 1 to 4; only one of them receives the money
SharesYou decide — they must add up to 100%The first surviving nominee in the order gets 100%
Best forDividing money between spouse and childrenNaming a backup in case your first choice is no more
Available forDeposit accounts, including FDsDeposit accounts; for bank lockers this is the only type allowed

Example: a ₹12 lakh FD, nominated two ways

Suppose Ramesh has a ₹12 lakh FD and wants to provide for his wife Sunita, son Aman and daughter Riya.

🤝 Simultaneous

  • Sunita — 50% → ₹6,00,000
  • Aman — 25% → ₹3,00,000
  • Riya — 25% → ₹3,00,000
  • Each is paid their share directly

🔢 Successive

  • 1st: Sunita gets the full ₹12,00,000
  • 2nd: Aman — only if Sunita is no more
  • 3rd: Riya — only if both are no more
  • Only one person is paid

* Principal only, for illustration. The nominees also receive the interest due on the FD in the same proportion.

⚠️ If a nominee dies before you That person's nomination stops being effective. In a simultaneous nomination, his or her share is then settled like a deposit with no nominee — which means paperwork for the legal heirs. Update your nomination whenever there is a death, marriage or birth in the family.

The four-nominee rule applies to bank deposits. Company (NBFC) FDs and post office deposits follow their own nomination rules, so read the application form before you book.

3. Joint FD — Choosing the Right Operating Mode

A joint FD is held by two or more people. What matters most is the operating instruction you tick on the form, because it decides who can withdraw — both now and after a death.

ModeWho Operates While All Are AliveOn the Death of One Holder
Either or SurvivorAny one holderSurvivor gets the FD
Former or SurvivorOnly the first holderSecond holder gets it — but only after the first holder's death
Anyone or Survivor(s) (3+ holders)Any one holderSurviving holders continue
JointlyAll holders must sign togetherNo survivorship — survivor and the deceased's legal heirs must claim together

For most couples, Either or Survivor is the practical choice. Former or Survivor suits a parent who wants full control during their lifetime but wants a child to receive the money afterwards.

💡 Add a nominee even on a joint FD A survivorship clause protects you only as long as one holder is alive. If both holders die together — in an accident, for example — only a nominee keeps the money out of legal tangles. On a joint FD, all holders must agree to add or change the nominee, and the nominee can claim only after all the holders have died.

Two things to remember on tax: interest and TDS on a joint FD are reported against the first holder's PAN, and on a tax-saving FD only the first holder can claim the Section 80C deduction.

4. Nominee vs Joint Holder vs Legal Heir

👤 Nominee

  • Named by you on the FD
  • Receives the money from the bank after your death
  • Holds it as a trustee — not automatically the owner
  • Has no rights during your lifetime

👥 Joint Holder

  • Co-holder named on the FD itself
  • Can operate the FD as per the mode chosen
  • Gets the money under a survivorship clause
  • Interest is reported on the first holder's PAN

⚖️ Legal Heir

  • Decided by your will or by succession law
  • The final owner of the money
  • Without a nominee, must prove the claim with documents
  • Can claim their share from the nominee
⚠️ A nominee is not the same as an owner Courts have repeatedly held that a bank nominee only receives the money on behalf of the legal heirs. If your will says something different from your nomination, the will generally prevails. Keep the two consistent — name the same people in both — to avoid family disputes.

5. How to Claim an FD After the Depositor's Death

If the FD has a nominee or a survivorship clause, the process is short:

1

Inform the bank

Visit the branch — many banks also accept this online — and tell them about the death. Ask for the deceased-claim form.

2

Submit three basic documents

The claim form, a copy of the death certificate, and the claimant's identity and address proof. With a nominee or survivor on record, the bank should not ask for a succession certificate, court order or third-party surety.

3

Decide: close now or continue

You can close the FD straight away — after a depositor's death, banks must allow premature closure without any penalty. A surviving joint holder can usually also let the FD run to maturity. Ask the bank which options it offers.

4

Receive the money

The bank credits the amount to the claimant's account. Under RBI's rules, the claim must be settled within 15 calendar days of the bank receiving all the documents.

✅ Your right if the bank delays If the bank takes more than 15 days after receiving complete documents, it must pay interest for the period of delay — at not less than the Bank Rate plus 4% a year — on the amount due. If your claim is stuck, quote this rule in writing, then escalate to the bank's grievance officer and, if needed, the RBI Ombudsman.
Plant growing from a jar of coins — passing fixed deposit savings on to family
A few minutes of paperwork today can save your family months of effort later.

6. No Nominee? The ₹15 Lakh Simplified Route

If there is no nominee and no survivorship clause, the legal heirs have to make the claim. RBI has made this easier for smaller amounts:

SituationWhat the Bank Asks For
Nominee or survivor on recordClaim form, death certificate and the claimant's ID proof
No nominee — claim up to ₹15 lakh
(₹5 lakh in cooperative banks)		All of the above, plus an indemnity bond, a no-objection or disclaimer letter from the other legal heirs, and a legal heir certificate or a declaration by an independent person who knows the family. No third-party surety.
No nominee — claim above the limitSuccession certificate, legal heir certificate or similar legal documents (or probate, if there is a will). The bank may also ask for a surety.

Even on the simplified route, getting no-objection letters from every heir can take weeks — and a succession certificate from a court can take months and cost money. A nomination avoids all of it.

7. Interest, Penalty and Tax After a Depositor's Death

RBI's rules protect the family from losing interest because of a death:

SituationInterest the Bank Pays
FD closed before maturity after the depositor's deathThe rate applicable to the period the FD actually ran — no penalty
Depositor died before maturity, claim made after maturityThe contracted rate up to maturity, then simple interest for the extra period at the rate applicable on the maturity date
Depositor died after the FD had already maturedSavings account rate from the maturity date until payment

On tax: the money a nominee or heir receives is an inheritance, not income — India has no inheritance tax. Interest is different. Interest earned up to the date of death goes into the deceased's final income tax return (filed by the legal heir), while interest earned after that is taxable in the hands of the person who receives it. Give the bank the claimant's PAN early so that any TDS is credited to the right person.

💡 Lock-in doesn't trap your family Normally you cannot break a 5-year tax-saving FD early. After the depositor's death, however, the nominee or legal heir can close it before maturity.

8. How to Add or Change a Nominee

1

Check your existing FDs

Look for "Nomination Registered" and the nominee's name on each FD receipt or in net banking. Older FDs often have no nominee at all.

2

Add or update — online or at the branch

Most banks have a nomination option in net banking or the mobile app. Otherwise, fill in the nomination form at your branch. There is no fee.

3

Choose the type

One nominee, or up to four — with percentage shares (simultaneous) or in an order of priority (successive).

4

If the nominee is a minor

Also name an adult who will receive the money on the child's behalf if you pass away while the child is still a minor.

5

Keep the acknowledgement

The bank must acknowledge your request within three working days. File it with your FD papers and tell your family where they are.

9. Smart Tips

📝

Check every FD separately

Don't assume the nominee on your savings account covers your deposits. Confirm the nominee on each FD.

🔄

Review after life events

Marriage, a new child, divorce or a death in the family — each is a reason to revisit your nominees.

📜

Match it with your will

Name the same people in your will and your nominations, so that nobody has to argue later.

🛡️

Joint FDs add insurance cover

An individual FD and a joint FD at the same bank get separate ₹5 lakh covers. See our DICGC insurance guide.

🗂️

Keep a family list

Write down the bank, FD number, maturity date and nominee for every deposit. Families can't claim what they don't know about.

👴

Seniors: use both

An Either or Survivor FD with your spouse, plus a child as nominee, covers almost every situation. Read our Senior Citizen FD Guide.

10. Frequently Asked Questions

How many nominees can I add to a fixed deposit?
Since 1 November 2025 you can name up to four nominees on a bank deposit. You can nominate them simultaneously, giving each a percentage share that adds up to 100%, or successively, in an order of priority where the next nominee becomes eligible only if the earlier one is no more.
Is a nominee the legal owner of the FD money?
No. A nominee is the person the bank pays, and the bank's responsibility ends there. Legally the nominee holds the money as a trustee for the legal heirs, who are decided by the will or by succession law. To avoid disputes, name the same people in your will and your nomination.
What happens to an FD if there is no nominee?
The legal heirs have to claim it. For claims up to ₹15 lakh (₹5 lakh in cooperative banks), banks follow a simplified process using an indemnity bond, no-objection letters from the other heirs and a legal heir certificate or declaration, without a third-party surety. Above that limit, the bank can ask for a succession certificate or similar legal documents.
Can a nominee break the FD before maturity, and is there a penalty?
Yes. After the depositor's death, banks must allow premature closure of the term deposit without any penalty, even if it has a lock-in. Interest is paid at the rate applicable to the period for which the deposit actually remained with the bank.
Which is better — a joint FD or a nomination?
They do different jobs. A joint holder is named on the FD and, under a survivorship clause such as Either or Survivor, gets the money when the other holder dies. A nominee comes into the picture only after all the holders have died. The safest arrangement is to have both — a joint FD with a nominee.
How long does a bank take to settle an FD death claim?
Under RBI's rules, a bank must settle the claim within 15 calendar days of receiving all the required documents. If it delays, it has to pay interest for the period of delay at not less than the Bank Rate plus 4% a year on the amount due.
Can I make a minor the nominee of my FD?
Yes. A minor can be a nominee. While nominating, you should also name an adult who will receive the money on the minor's behalf if you pass away before the child turns 18.

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Disclaimer: This article is for informational purposes only and does not constitute legal, investment or tax advice. Nomination and claim-settlement rules are as applicable to banks in October 2026 under the Banking Laws (Amendment) Act, 2025 and RBI directions; individual banks' forms, limits and processes may differ, and NBFC and post office deposits follow separate rules. Who finally inherits depends on your will and the succession law that applies to you. Please check with your bank and consult a qualified legal or tax adviser before making decisions.

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