1. Summary
  2. Bankers’ Special Relationship
  1. Debtor and creditor
  2. Creditor and debtor
  3. Principal and agent
  4. Bailor and bailee
  5. Trustor and trustee
  6. Pledger and pledgee
  7. Mortgagor and mortgagee


Relationship bankers are money trade professionals who are experienced in each client service and financial data as relates to the banking system. Considering a career as a relationship banker needs you to 1st perceive the duty responsibilities and steps you wish to accomplish to be eligible for this role. 


The Banking laws Act 1949, Sec.5 (b) defines the term banking as “Banking suggests that acceptive, for the aim of disposal or investment, of deposits of cash from the general public owed on demand or otherwise and withdraw by cheque, draft, and order or otherwise.”

Bankers’ Special Relationship

Today we tend to shall see the Special relationship. The gap of associate degree account by a client with a banker creates associate degree obligation on the banker towards its client in respect of sure rights and responsibilities. Those rights and responsibilities also are called “Special options of Relationship between a Banker and Customer”. The subsequent are the special relationships between banker and client:

Debtor and Creditor

When a ‘customer’ opens an associate degree account with a bank, he fills in and signs the account gap kind. By sign language the shape he enters into associate degree agreement/contract with the bank. Once the client deposits cash in his account the bank becomes a person of the client and client a soul. The money therefore deposited by the client becomes the bank’s property and the bank contains a right to use the money because it likes. The bank isn’t certain to inform the investor of the style of the utilization of funds deposited by him. Bank doesn’t offer any security to the investor i.e. debtor. The bank has borrowed cash and it’s only if the investor demands, banker pays. Bank’s position is kind of totally different from traditional debtors.

Creditor and Debtor

Lending cash is that the most significant activity of a bank. The resources mobilized by banks are used for disposal operations. A client who borrows cash from a bank owns cash to the bank. Within the case of any loan/advances account, the banker is that the soul, and also the client is that the person. The link within the 1st case once someone deposits cash with the bank reverses once he borrows cash from the bank. Recipient executes documents and provides security to the bank before utilizing the credit facility. 

Principal and agent

Sec. 182 of ‘The Indian Contract Act, 1872’ defines “an agent” as someone utilized to try to do any act for one more or to represent another in dealings with third persons. The person for whom such act is finished or who is therefore drawn is named “the Principal”.

Thus associate degree agent may be a person, who acts for and on behalf of the principal and underneath the latter’s specific or understood authority and also the acts did among such authority are binding on his principal and, the principal is prone to the party for the acts of the agent.

Bailor and Bailee

A “bailment” is that the delivery of products by one person to a different for a few purposes, upon a contract that they shall, once the aim is accomplished, became back or otherwise disposed of in line with the directions of the person delivering them. The person delivering the products is named the “bailor”. The person to whom they’re delivered is named, the “bailee”.

Trustor and Trustee

As per Sec. 3 of Indian Trust Act 1882, a “trust” is an associate degree obligation annexed to the possession of the property, and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the advantage of another, or of another and also the owner. Thus, the trustee is that the holder of property on behalf of a beneficiary.

In the case of a trust, banker client relationship may be a contract. Once someone entrusts valuable things with an associate degree another person with an intention that such things would come back on demand to the keeper the link becomes of a trustee and trustier.

Pledger and Pledgee

The relationship between client and banker will be that of grownup and grownup. This happens once the client pledges (promises) sure assets or security with the bank so as to induce a loan. During this case, the client becomes the grownup or Pawnor, and also the bank becomes the grownup or Pawnee. Underneath this agreement, the assets or security can stay with the bank till a client repays the loan.

Mortgagor and Mortgagee

As per section fifty-eight of Transfer of Property Act 1882, the mortgage is the transfer of an interest in specific immovable property for the aim of securing the payment of cash advanced or to be advanced by the method of loan, associate degree existing or future debt, or the performance of associate degree engagement which can make to monetary liability. The debtor solely pats with the interest within the property and not the possession. The transferrer of interest in property, is named a debtor and also the transferee is named a creditor. During this case, the client became the debtor, and also the Banker became the creditor.

About the Author

BankReed Admin

Banking Professional with 16 Years of Experience. The idea to start this Blogging Site is to Create Awareness about the Banking and Financial Services.

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