A child who has completed ten years of age can open a savings account even without the assistance of a parent. However, the bank must decide, according to its own policy and after assessing the risks, what restrictions should be applied to such an account (for example – the maximum balance allowed, the amount the child is permitted to withdraw, and whether any conditions should be imposed if a debit card or cheque book is issued).
Banks operate in the service of society. Naturally, they remain in regular contact with various segments of the community. One such segment is minors - children who have not completed eighteen years of age. These individuals are also referred to as “persons of unsound knowledge.” All transactions in banking fall under the legal term “contract,” and a “contract” can only be entered into with a “competent person” (an individual who has completed eighteen years of age). Naturally, any contract with a minor is considered void. Such transactions are regarded merely as an “agreement.” There is a fundamental difference between a contract and an agreement. If it is a contract, one can approach the court in case of a dispute; this right does not exist in an agreement. Therefore, in the case of a person of unsound knowledge, the bank’s access to the courts is closed. Naturally, banks are compelled to conduct transactions with such persons of unsound knowledge very cautiously.....(To continue, open the magazine)