What is an Account Closure? Definition of Account Closure

June 23, 2022
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Before learning about account closure, let’s hear some conversation related to it.

Conversation 1:

Phone rings, Trn ! Trn ! ☎

Bank Executive: Hello, KDFC Bank St. Sebastian Garden branch.

Customer: I want to close my account, and i want a account closure form for the same.

Bank Executive: What happened sir? Our Branch manager want to talk to you.

Conversation 2:

Phone rings, Trn ! Trn ! ☎

Broker: Hello, JJFL Securities Ltd.

Client: I want to close my demat account, and i want a account closure form for the same.

Now, what do you think why people want to close their accounts with their respective banks, broker or any other financial institution?

Anything could be reason, may be they don’t like the services or client or customer has defaulted. The client or customer (in the case of a bank) and the clearing member, or at the participant’s discretion, closing beneficiary and pool accounts if the client has broken its duties to the participant.

account closure actually means that closing of participant’s account. The account closure has a specific procedure or process. First the participant needs to fill the form which was provided by participant’s bank, broker or any other financial institution. Then participant need to submit the form in the branch and then after checking form and legal paperwork, Banks or financial institution will close their account. after that participant will no longer to use their service and products.

Bank or financial institutional may automatically close their specific participant’s account if they notice any unethical activity from them. It may defaulting in loans, taking leverage and not paying on time, bad delivery of shares or anything.

Participant can also write a letter to manager or head of the branch stating that he/she wants to close account with their firm, which will be termed as account closure letter or bank account closure letter.

Banks's account closure

Every banks has their own account closure form. This list of all these forms are axis bank account closure form, sbi account closure form, hdfc account closure form, icici account closure, yes bank account closure, dcb bank account closure, kotak bank account closure and pnb account closure etc.

We all know that the account in the banks are in two form one is savings account and another one is current account. Corresponding to that we will have current account closure form and savings account closure form.

NBFC's account closure.

Every financial institute has its own account closure form. This list of brokers and nbfc can give you an idea, zeordha account closure, angel broking account closure, groww account closure form, upstox account closure form, You can open an account with broker company but not with NBFC and if you are closing account with your broker then it will be demat account closure form.

Contents in account closure form.

So This form includes following details:

Name
Account Number/Client ID(In case of Broker)
Account Type
Debit/Credit Card Details for destroying.
Phone Number
Reasons why you are closing account, since you are their customer and they are earning from you. (This section has lots of questions around 8-10)
Your Signature at the end.

They also asks you in which form you need the remaining amount. it could be DD/PO

Contents in account closure form.

So This form includes following details:

Name
Account Number/Client ID(In case of Broker)
Account Type
Debit/Credit Card Details for destroying.
Phone Number
Reasons why you are closing account, since you are their customer and they are earning from you. (This section has lots of questions around 8-10)
Your Signature at the end.

They also asks you in which form you need the remaining amount. it could be DD/PO