Termination of the relationship between a Banker and a customer -

The relationship between banker and customer may be terminated in any of the following ways -

1.By mutual agreement

2. Death of customer

3.Lunacy of customer

4. Notice to terminate

5. Bankruptcy

6. Order of court

7. Transfer of balance amount

By mutual agreement -

The relationship between banker and customer may be terminated by mutual agreement.

2. Death of customer -

Death of a customer is an obvious reason for terminating the relationship between banker and
customer. On the receiving the notice of death of the customer the bank stops the payment. The
dissolution of a corporation customer is equivalent to death.

3. Lunacy of customer -

The Lunacy of a Customer terminates the relationship between banker and a customer. Bankers
authority to pay cheques is revoked by notice of insanity. But unless the evidence of insanity is fairly
conclusive, the banker's wisest course would appear to be to treat the customer as sane in so that the
banker is not held liable for damages for wrongful dishonor.

4. Notice to terminate -

In case of any current account, no such notice by the customer to a banker appears necessary. But
if it is a deposit account the banker could insist on the notice period specified on the fixed deposit
receipt/book.

5. Bankruptcy -

The bankruptcy or winding up of the bank is a sufficient ground for terminating the relationship
between a Banker and customer.

6. Order of court -

If the court restrains the banker to carry on further of the banking business, the account of the
customer comes to an end.

7. Transfer of balance amount -

If the customer transfers the whole amount of balance of his account to any other person, then the
account may be closed by the banker. In this way the relationship of banker and customer comes to an
end.