Section 36 of The Small Industries Development Bank of India Act, 1989
- (1)The Small Industries Bank shall not, except as otherwise required by this Act or any other law, divulge any information relating to, or to the affairs of, its constituents except in circumstances in which it is, in accordance with the law or practice and usage customary among bankers necessary or appropriate for the Small Industries Bank to divulge such information.
- (2)The Small Industries Bank may, for the purpose of the efficient discharge of the functions under this Act, collect from or furnish to the Central Government, Reserve Bank, Development Bank, State Bank, any subsidiary bank, nationalised bank or other scheduled bank, State Cooperative Bank, State Financial Corporation, State Industrial Development Corporation, State Small Industries Corporation or the National Small Industries Corporation or such other institutions 1[as may be specified by the Board], credit information or other information as it may consider useful for the purpose, in such manner and at such times, as it may think fit. Explanation.--For the purpose of this sub-section, the expression "credit information" shall have the same meaning as in clause (c) of section 45A of the Reserve Bank of India Act, 1934 (2 of 1934), subject to the modification that "banking company" referred to therein shall mean a bank, corporation or other institution referred to in this sub-section.
- (3)Every Director, member of a committee, auditor, officer or other employee of the Small Industries Bank 2*** whose services are utilised by the Small Industries Bank under the provisions of this Act, shall, before entering upon his duties, make a declaration of fidelity and secrecy in the form set out in the First Schedule to this Act.
Summary
- The bank is required to keep all information about its customers private and secret.
- The bank can share information if a law requires it or if sharing is a standard, customary practice among bankers.
- The bank is allowed to collect credit information and share it with specific government and financial bodies, such as the Reserve Bank of India, to help perform its duties.
- Every director, auditor, and employee must sign a specific form, called a declaration of fidelity and secrecy, before they start their work at the bank.
Practical examples
FAQ
1. Will the bank ever share my business secrets with the public?
No, the bank must keep your information secret unless a specific law requires it to be shared or it is a standard banking practice.
2. Can the bank check my credit history with other banks?
Yes, the bank can collect and share credit information with other specific banks and government bodies to do its job safely.
3. Do bank employees take an oath of secrecy?
Yes, all staff and directors must sign a declaration of secrecy before starting their jobs.
Test yourself
Q1.Under Section 36 of The Small Industries Development Bank of India Act, 1989, what document must every director and employee sign before entering upon their duties?
Q2.Under Section 36 of The Small Industries Development Bank of India Act, 1989, under what condition can the bank divulge information about its constituents?
Q3.According to Section 36 of The Small Industries Development Bank of India Act, 1989, with which of the following entities is the bank explicitly permitted to share credit information?
Q4.Under Section 36 of The Small Industries Development Bank of India Act, 1989, where is the specific form for the declaration of fidelity and secrecy located?