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8 Banker Customer Relationship PDF
8 Banker Customer Relationship PDF
Presented by
Dr.S.C.Bihari
I B S, HYDERABAD
Banker and Customer Relationship
•
The Primary A Banker and
between
relationship A Customer
Debtor
Is that of
and
creditor
Banker Customer Relationship
• The position is either a creditor or a debtor
depending upon whether the bank has lent
money or accepted deposits.
• Various transactions gives rise to different
relations.
TRANSACTION-RELATIONSHIP
• Transaction Bank Customer
• Deposits in the bank Debtor Creditor
• Loan from bank Creditor Debtor
• Locker Lessor Lessee
• Safe custody Bailee Bailor
• Purchase of draft Debtor Creditor
TRANSACTION-RELATIONSHIP
• Transaction Bank Customer
• Payee of draft Trustee Beneficiary
• Cheque Collection Agent Principal
• Pledge Pawner Pawnee (Pledger)
• Mortgage Mortgagee Mortgagor
• Standing instruction Agent Principal
TRANSACTION-RELATIONSHIP
• Transaction Bank Customer
• Sale / purchase of securities on behalf of
customer Agent Principal
• Money deposited but instructions not given
for its disposal Trustee Beneficiary
• Shares given for sale Agent Principal
• Assignment Assignee Assignor
• Hypothecation Hypothecatee Hypothecator
Bankers’ Obligation
• Banks have an obligation to honor cheques
drawn on it if the customer has sufficient
funds.
• The obligation is extinguished by a garnishee
order from the court.
• If a cheque is dishonored without
justification, banks are liable to compensate
the customer for injury to his credit.
• The bank is obliged to return dishonored
cheque to the customer.
Bankers’ Obligation contd.
• Banker is bound to act according to the
directions given by the customer.
• Banks are liable for thefts or embezzlement
by employees committed during the course
of bank’s business.
• Banks are obliged to provide service to its
customers (even if the customer has not paid
dues).
• Banks are obliged to maintain secrecy of
client accounts.
The banker may give information:
• When he is statutorily required to do so.
• Where disclosure is under compulsion of
law.
• With express or implied consent of the
customer.
• To other banks. This is known as
common courtesy between banks.
• In this case apart from making general
statements no specific information are
given.
The banker may give information: