Indemnity Relationship

PPB Banker-Customer Relationship Free JAIIB Capsule 46 views Updated 23 Sep 2026

Capsule FREE

PPB · Banker-Customer Relationship

When a bank issues a duplicate demand draft to a customer who lost the original, what relationship is established?

Tap to flip and reveal the answer

The Bank is the Indemnified (Indemnity Holder), and Customer is the Indemnifier.

Governed by Sec 124 of Indian Contract Act. The customer promises to compensate the bank against any loss from the duplicate issuance.

46 views WhatsApp

Indemnity Relationship — Full Text

When a bank issues a duplicate demand draft to a customer who lost the original, what relationship is established?

Answer

The Bank is the Indemnified (Indemnity Holder), and Customer is the Indemnifier.

Additional notes

Governed by Sec 124 of Indian Contract Act. The customer promises to compensate the bank against any loss from the duplicate issuance.

Part of Principles & Practices of Banking · Banker-Customer Relationship · Last updated 23 Sep 2026

Comments (0)

Login to post a comment.

No comments yet. Start the discussion!

Related JAIIB PPB Capsules

When a customer opens a savings or current deposit account with a bank, what is the primary legal relationship established?

The Bank is the Debtor, and the Customer is the Creditor.

What is the banker-customer relationship when the bank grants a loan or advance to the customer?

The Bank is the Creditor, and the Customer is the Debtor.

What is the legal relationship between the bank and customer when valuables are deposited for safe custody?

The Bank is the Bailee, and the Customer is the Bailor.

In the Account Aggregator framework, who ultimately holds the power to initiate the transfer of financial information?

The customer. The transfer of information happens ONLY based on an explicit, digital, and revocable consent provided by the customer.

When a bank provides a safe deposit locker to a customer, what specific relationship is formed?

The Bank is the Lessor, and the Customer is the Lessee.

In a pledge transaction where goods are kept as security, what is the relationship between the bank and the borrower?

Bank is the Pawnee (Pledgee), Customer is the Pawner (Pledger).