Mandate

A person competent to enter into a contract may authorize another person to operate an account on his behalf. This authority can be granted by a mandate or power of authority. A mandate is an authority given by the accountholder in favor of a third person to do certain acts on his behalf. The person authorized to operate the account is called mandatee. The accountholder can appoint more than one mandatee in the account, however, the mandatee is not authorized to appoint another mandatee or cancel signature of the accountholder or close the account.

• Customer informing bank that he/she has authorized a person to operate account on his behalf
• Signature of the mandate are obtained in the mandate letter and are verified by the customer
• Mandate is normally issued for a short and temporary period.
• In the case of joint accountholders, all customers must sign mandate irrespective of operational instructions, while in case of a partnership firm; all partners should sign mandate letter.
• A mandate terminates to be valid on death, insanity, insolvency and bankruptcy of accountholders.
• A mandate can be withdrawn anytime by accountholder.