Bank lockers are often used to store valuable items such as cash, important documents, and jewellery, providing individuals with a sense of security.
However, a recent incident highlighted by a content creator raises concerns about the safety of such items. In this case, ₹18 lakh cash stored by a lady in Moradabad, Uttar Pradesh, in a bank locker was allegedly destroyed by termites in 2023, sparking questions about the reliability of lockers for safeguarding valuables and the policies that banks have in place for compensation. “Uss lady ko ek paisa bhi reimbursement nahi mila (That lady did not receive even a single penny as reimbursement),” notes Vijay NihalChandani.
According to a report by Business Today, “The woman kept the money along with some jewellery in the locker in October 2022 for her daughter’s wedding.”
While we often believe that bank lockers offer a foolproof solution for storing precious assets, the risks may not be as clear-cut as we assume. We delve into what you need to know before choosing a bank locker to store your valuable items and whether banks offer compensation if your belongings are damaged or destroyed while in their care.
Risks associated with storing cash, documents, and jewellery in a bank locker
Snehasish Das, quantitative analyst at Solvay Brussels School of Economics and Management, tells indianexpress.com, “Bank lockers provide a secure option for storing valuables, but they are not without risks. Understanding these risks and taking proactive steps can help safeguard your belongings.”
Das states that environmental factors, such as high humidity or pest infestations like termites, can cause significant damage to cash and documents. Additionally, natural disasters such as floods or earthquakes can lead to water or structural damage. While theft or robbery is relatively rare, sophisticated burglary attempts can still target bank lockers. Another risk involves bank liability limitations, as banks typically have restricted liability for locker contents, which may not cover all damages or losses.
If external factors damage items in a bank locker, is the bank legally obligated to provide compensation?
Das informs, “Banks’ legal obligation to compensate for damage to locker contents depends on the circumstances and governing regulations. As per the Reserve Bank of India (RBI) guidelines issued in 2022, banks are responsible for ensuring the safety and security of lockers. In case of loss or damage to locker contents due to incidents like theft, fire, building collapse, or employee fraud, banks must compensate customers up to 100 times the annual rent of the locker.”
“For damages caused by natural disasters (e.g., floods or earthquakes), banks are not liable if they have taken adequate safety precautions. The bank is not responsible for damages caused by the customer’s negligence, such as improper packaging of cash or documents that led to termite damage,” remarks Das.
Store cash and documents in sealed, waterproof bags to prevent damage from humidity or pests. (Source: Freepik)
How do banks ensure the safety and maintenance of their lockers?
Banks implement rigorous security measures and maintenance practices to safeguard lockers, but vulnerabilities can still exist. “Physical security measures include vaults made of reinforced steel, housed in secure areas with limited access, and monitored by CCTV and advanced alarm systems. Access protocols, such as dual-key systems requiring the presence of both the bank and the customer to open the locker, and detailed logs of locker access, further enhance security. High-quality lockers are also designed to withstand humidity and pests, with routine pest control measures in place to prevent infestations,” Das explains.
Precautions individuals should take when storing valuables in a bank locker
To ensure your valuables remain safe and intact, adopt the following precautions when using a bank locker.
Protective Storage: Store cash and documents in sealed, waterproof bags to prevent damage from humidity or pests. Use fireproof pouches or containers for sensitive documents and currency.
Avoid Storing Loose Cash: Instead of storing cash, opt for bank deposits or fixed deposits that earn interest and are less susceptible to damage.
Inventory Management: Keep a detailed inventory of items stored in the locker, including photographs, to simplify insurance claims if needed.
Regular Inspections: Periodically visit the bank to inspect the condition of stored items and ensure no environmental damage has occurred.
Insurance Coverage: Purchase a comprehensive insurance policy for high-value items stored in the locker to ensure financial protection against unforeseen damages.
Why should you buy our Subscription?
You want to be the smartest in the room.
You want access to our award-winning journalism.
You don’t want to be misled and misinformed.
Choose your subscription package
