Banking Laws (Amendment) Bill, 2024, was introduced by the Finance Minister

Current Context: The Banking Laws (Amendment) Bill, 2024, was indeed introduced by Finance Minister Nirmala Sitharaman in the Lok Sabha on August 9, 2024.

• Key Provisions of the Bill
• This comprehensive bill aims to bring significant changes to the banking sector.
• Some of the key provisions include:
• Increased nominees per bank account: Allows up to four nominees for bank accounts, deposits, and safe deposit lockers.
• Redefining 'substantial interest': Raises the threshold for 'substantial interest' for directorships from ₹5 lakh to ₹2 crore.
• Flexibility in auditor pay: Grants banks more freedom in determining auditor remuneration.
• Revised reporting dates: Changes regulatory reporting dates for banks to the 15th and last day of each month.
• Unclaimed dividends: Enables individuals to claim unclaimed dividends, shares, or interest transferred to the Investor Education and Protection Fund (IEPF).
• Tenure extension for cooperative banks: Increases the tenure for directors (except chairperson and whole-time directors) in cooperative banks from 8 to 10 years.

Question:

1 How has the threshold for 'substantial interest' for directorships been changed by the Banking Laws (Amendment) Bill, 2024?

• A) Increased from ₹1 lakh to ₹50 lakh
• B) Increased from ₹2 lakh to ₹1 crore
• C) Increased from ₹5 lakh to ₹2 crore
• D) Decreased from ₹10 lakh to ₹5 lakh

Answer: C) The bill raises the threshold for 'substantial interest' for directorships from ₹5 lakh to ₹2 crore, which affects the eligibility criteria for directorships.