By News Desk 
New Delhi – In a landmark decision aimed at fostering financial literacy among the youth, the Reserve Bank of India (RBI) has announced that children aged 10 years and above will now be allowed to open and operate their own bank accounts independently—without requiring a parent or guardian. This move is expected to pave the way for early financial awareness and responsible money management among young citizens.
Previously, minors could only hold bank accounts under the supervision of a guardian. With this new guideline, children will gain exposure to fundamental banking services, including savings accounts and fixed deposits, helping them transition from piggy banks to real-world financial systems.
What Changes with the New Rule?
This decision, which comes into effect from July 1, 2025, will require banks to update their internal policies and establish clear protocols for managing accounts operated by minors. All transactions in such accounts will be closely monitored to prevent misuse or fraud.
Financial expert Jitendra Solanki praised the move, stating, “This is not just about bank accounts—this is about empowering the next generation with the knowledge and responsibility to manage money wisely. By operating their own accounts, children will learn to save, budget, and spend thoughtfully, which are essential life skills in today’s economy.”
Key Provisions of the New Guidelines
- Children aged 10 and above will be eligible to open and manage their own bank accounts without parental oversight.
- Children under 10 can also have bank accounts, but those will be managed by their parents or legal guardians. In such cases, overdraft facilities will not be permitted.
- Know Your Customer (KYC) compliance will be mandatory for all minor accounts, ensuring the identity and legitimacy of account holders.
- Upon turning 18, the minor must provide a fresh signature and updated operating instructions for continued account access.
What Banks Need to Do
Banks have until July 1, 2025, to update their frameworks in accordance with the RBI directive. They will be responsible for:
- Defining the maximum transaction limits for minor accounts based on the child’s age and maturity level.
- Implementing secure protocols for monitoring minor-operated accounts.
- Ensuring the privacy and protection of minors’ personal information.
- Displaying clear instructions to avoid fraudulent practices involving minors’ accounts.
Transaction Limits to Be Bank-Specific
The RBI has left it to individual banks to determine how much a minor can transact. These limits will vary based on the child’s age, understanding of financial responsibility, and banking behavior. The goal is to encourage children to learn how to manage money prudently—how to save, where to spend, and why financial planning matters from a young age.
Awareness of Exploitation Risks
The RBI has also issued a caution to financial institutions to ensure transparency and prevent misuse of accounts under the guise of services for minors. All banks must implement strict controls, especially for accounts operated independently by children.
This regulatory reform by the RBI is being hailed as a transformative step towards building a financially aware generation, enabling children to grow into informed, self-reliant adults capable of making sound economic decisions in the future.
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