Park your valuables in private vaults :: Business Line

Please Share::

�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��

��

-->

Worried about keeping your jewellery and documents at home? The first option that presents itself is a bank locker. But snagging a bank locker is hard; one usually has to comply with conditions such as parking a large deposit with the bank or taking up an insurance policy that may not really suit one’s needs.

But banks are not the only option you have. Private companies also offer safe deposit lockers for a nominal fee. Many of these companies have been in this business for the past several decades. Private locker services score over bank lockers on a few counts.

Advantages abound

One, private players offer competitive rates and fees. The annual charges of private service providers are comparable to their public and private sector bank counterparts. For instance, Bank of Baroda charges an annual fee of ₹1,100 for its A type locker, measuring 4.5 inches in length, 5.8 inches in breadth and 21 inches in depth.

Similarly, Union Bank of India charges ₹1,121 as annual fee for a locker measuring the same size. But Chennai-based Kothari Safe Deposit Ltd (KSDL)offers a similar-sized locker for an annual fee of ₹900. Likewise, South-based Sakthi Finance offers a locker of the same size for an annual fee of ₹1,000. Bank locker charges can also vary with location, even within the same city. Two, the security deposit payable can often be lower than, or less restrictive, with private players. Private locker service providers insist on a security deposit, which in many cases is roughly three times the annual fee payable. The deposit is refundable at the time of surrendering the locker.

Banks, however, do not have a uniform set of rules for allotment of lockers. Most banks make it mandatory for you to maintain fixed deposits more than thrice the annual fee or sell you ULIPs.

Three, unlike the private and public sector banks which allow you to operate lockers only on weekdays, often restricted to banking hours only, most private service providers are open on Sundays too.

For instance, Sakthi Finance, which offers safe facility in 20 locations across Tamil Nadu, is open even on Sundays. Likewise, India Safety Vaults Ltd (ISVL), which provides locker facility to residents in Pune and Mumbai, claims that it is open almost 14 hours a day for six days a week.

According to information available on the company’s website, customers of ISVL can access the locker on Sundays too — between 9.30 am and 3.30 pm.

Some of them are open on public holidays too. For instance, KSDL is shut only nine days in a year, even as banks may be closed for at least 15-20 days in a year.

There is also no limit on the number of times that you can operate the locker in a said year with private service providers. For instance, KSDL allows customers unlimited access to their lockers. In contrast, banks have a cap on the number of times you can operate your locker.

Union Bank of India allows customers to operate their lockers 12 times in a year for free, beyond which it charges ₹20 an operation.

Safety rules

Of course, since it’s your valuables that you are keeping in the locker, the safety precautions the providers take is paramount. You may also want to reassure the genuineness and track record of such private service provides. Private companies, unlike banks, are not regulated by the RBI.

For instance, Kothari Safe Deposit, which was one of the earliest private companies to offer this service, has been in this business for the past 75 years. Likewise, Delhi-based Delhi Safe Deposit Company (DSDC) has been offering safe deposit lockers since 1937.

These private companies have the requisite infrastructure and safety systems in place.

“The buildings which house the vaults have concrete fireproof walls and fire-resistant cables. We have separate power control for the vault area and when the office is closed, the power supply to the vault area is suspended. “This minimises the risk of any mishap due to short circuit,” explains RU Trivedi, CEO, Kothari Safe Deposit. “In the late 1990s, when there was a major fire accident in KSDL’s head office in Chennai, our safe vault remained safe and intact, thanks to the fool-proof infrastructure.”

When it comes to rules on death of a locker holder, banks usually allow you to choose a nominee in the event of death of the locker holder.

Private companies, on the other hand, encourage customers to open joint lockers. “We allow three members to handle one locker on an either or survivor basis,” says Trivedi.