Types of Joint Accounts in Banks in India

Do you know how many types of joint accounts in banks are available in India and what are the pros and cons of these types of accounts?

Types of Joint Accounts in Banks in India

Many of us are simply holding bank accounts as single holders. However, there are various ways through which we can open and handle bank accounts. In this post, I will try to share the types of joint accounts you can hold in banks.

I have received this email from one of my blog readers.

Dear Sir,

I  request for your advice on the following. I am 84+ years old and my wife is  81+. I have been seeking your guidance in financial planning since long and you have been so good to help me. 

Our Savings bank accounts are in A or S mode. I do not recollect why I had chosen A or S and not E or S. 

Can you please advice which one is better and the reason for it considering our age. If there is any article on this, I would appreciate if you can send me the same.“.

This may be a confusion many of us are facing. Hence, thought to write a blog post on this.

What is a joint account?

It is a normal savings account where more than one account holder is allowed to own or operate the bank account.

The advantage of such a joint account is that you can have a single account through which you can start investing. You can have control over the transactions from account holders. This actually sometimes reduces the misuse of the fund. This also helps in paying the shared expenses. After the death of any one account holder, then managing the account is easy without any succession certificate.

Ideally, if the joint account is not within the family, then you both have to submit the address proof. A debit card is issued separately for all account holders. However, cheque books are issued together.

However, it is always best to open a joint account with someone who should be within the family or you trust the most. If you have to open an account with an outsider, then it is better to have a clear understanding in writing with the purpose of opening such a joint account.

No matter whatever may be the type of account set up, the tax liability is always on the head of the primary or first account holder (unless the primary holder mandates the bank about the specific percentages).

You can request the bank to add a new joint account holder or delete any of the existing joint account holder’s names. However, all the existing account holders have to sign on the request form if the mode of operation is “either or survivor” or “jointly“.

Also, the Primary/First applicant can restrict Internet banking access for other joint account holders (if required). Some banks provide this option in the Account opening form itself.

Types of Joint Accounts in Banks

Let us try to understand the various types of joint accounts in banks that can be possible to open.

# Either Or Survivor (E or S)

It is the most common form of account as many may be aware of. Only two individuals can operate the account i.e., the primary account holder and the secondary account holder. Both can access the account and transfer the funds.

The final balance and interest (if any) will be paid to the survivor on the death of any one of the account holders. The survivor can opt to continue the account or can close the account as per her wish.

However, if the nominee is a different person then the balance of money is paid to him/her after the death of the survivor.

For example, a father and son can open an either or survivor account. Both are allowed to operate the account. However, in case of the sudden demise of anyone, then the survivor can continue the account as a single account.

Anyone Or Survivor (A or S)

This is similar to E or S option as explained above. The only difference is that in this case, there is no such restriction on account holders. Hence, if you have more than two individuals, then you can open an A or S type of account.

For example, a father, mother, son, and his spouse all together open an A or S account. All have access to operate the account.

However, in case of the sudden demise of any one member of an account, then the survivors can continue the existing A or S account.

Former or Survivor (F or S)

It is one more type of joint account however with certain restrictions. In this type of account, only the first account holder can operate the account. Once on the death of the first account holder, then the second account holder is allowed to operate the account.

The survivor will get the balance transferred to his name after the demise of the first or primary account holder.

Latter or Survivor (L or S)

This is exactly the opposite of the F or S account type of setup. Here, the secondary holder has the right to operate the account but not the primary account holder.

The primary or first account holder will be eligible to operate the account only on the demise of the second account holder.

Joint Accounts

In joint accounts, all the transactions need to be signed and mandated by all the account holders. If one of the account holders dies, the account becomes completely inactive and cannot be operated further. Any funds left over in the account shall be distributed among the survivors.

Jointly or Survivor (J or S)

This is similar to joint accounts. However, the only one difference is that in case of the death of any account holder, then the account will not turn inoperative. The survivor/s can choose to continue the account.

Minor Accounts

If the primary account holder is less than 18 years of age, then, a parent or a guardian has to act like a secondary account holder. As per the law, this is mandatory to have a guardian for such minor accounts. The parent or the guardian should hold a joint account with the minor until he/she reaches the age of 18 years.

7 Responses

  1. Basu sir,

    Good article !

    My dad & mom held a joint account with IOB in E or S mode, with dad being primary. Now post his demise, I had requested the bank to have the a/c transferred to my mom and conveyed that I am OK to do the re-KYC. But the bank informs that it cannot be done as my dad is the primary holder, and so it has to be closed and a new A/C has to be opened. Is the bank right in doing so, then what is the use of E or S mode ?

  2. Dear Basu Sir,
    Very well explained article.
    one small doubt. when we use internet banking from joint account, always the first account holder can invest and second account holder cannot use account for investing in mutual funds inspite of having provided aadhar and pan to the bank. This has happened to me personally where me and my life partner have joint account SB with E or S operation. I am first account holder and she is second. always when i use internet banking for investment its permitted, but for her its not. This is happening perticularly for MF investments. Can you please tell what is wrong here and why it happens like this Sir?

    Thanking you in advance

    1. Dear Rajesh,
      It may be due to certain restrictions at bank level itself. Whether you checked this with the bank?

  3. Hi Sir,

    I am following you for a long time, and gained the knowledge about finances using your blogs & following in FB too (even in Asan group). Thanks for the enlightment you have shown me.

    I am holding salary accounts in 2 different banks and provided my spouse as the nominee. My questions are,
    1) Am I allowed to convert my Salary account to joint account with my spouse who is a home maker? Or should I need to open a new account and operate it as a E or S?

    2) How would the Joint account treated with E or S when it comes to tax computations, provided my wife has no income & do not file IT for her due to same

    1. Dear Balaji,
      Thanks for your kind words.
      1) Yes, you can convert the salary account to joint account. However, once you convert, then you have to manage minimum balance (the zero balance feature will goes off).
      2) As I have mentioned above, the tax liability is on primary account holder.

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