What Is a Bank Mandate?
A bank mandate is a written authorization that permits a bank to act on behalf of an account holder for specific transactions. It defines who can give instructions, the type of instructions that can be given, and any limits that apply. Common uses include salary payments, recurring invoices, loan repayments, and direct debits.
Why Would You Need to Change a Mandate?
Mandates are not static. Situations that trigger a change include:
- Change of signatories a new director or authorized officer joins the organization.
- Change of banking details you are switching to a different account or bank.
- Update of transaction limits increasing or decreasing the amount that can be transferred without further approval.
- Legal or regulatory requirements compliance with new legislation or internal governance policies.
- Consolidation of multiple mandates into a single, streamlined mandate.
Key Elements of a Change of Bank Mandate Form
The form is usually divided into several sections. Below is a typical layout and the information required in each part.
| Section | Details Required |
|---|---|
| Account Information | Account name, number, branch, and SWIFT/IBAN if applicable. |
| Existing Mandate Details | Current signatory names, their designations, and the date the existing mandate was approved. |
| Proposed Changes | New signatories, removal of existing signatories, updated limits, or new transaction types. |
| Supporting Documents | Board resolution, identification proof of new signatories, address proof, and any statutory filings. |
| Authorization | Signatures of authorized persons, date, and banks stamp or verification seal. |
StepbyStep Guide to Completing the Form
- Gather Required Documents Ensure you have the latest board resolution, ID copies, and proof of address for each new signatory.
- Fill in Account Information Enter the exact account name and number as shown on the bank statement.
- Record Existing Mandate Details This helps the bank verify the change against the current records.
- Specify the Changes Clearly list who is being added or removed, the new limits, and any special instructions.
- Attach Supporting Documents Attach the resolution and ID copies in the order required by the bank.
- Obtain Signatures All existing authorized signatories and the newly added ones must sign the form, unless the bank allows a single signatory to approve the change.
- Submit to the Bank Deliver the completed form in person, via secure mailbox, or through the banks online portal if offered.
- Confirm Receipt Request a written acknowledgment from the bank and verify that the new mandate is active.
Common Mistakes to Avoid
- Incomplete Signatures All required parties must sign; missing a signature can delay processing.
- Outdated Documents Use the most recent board resolution; older versions are rejected.
- Incorrect Account Details A single digit error can cause the mandate to be applied to the wrong account.
- Skipping the Notarisation Some banks require that the form be notarised or witnessed.
- Ignoring Limits If you increase a transaction limit, ensure it aligns with internal approval policies.
FAQs
1. How long does it take for a new mandate to become effective?
Processing time varies by institution. Most banks complete the change within 35 business days after receiving a complete and correct submission.
2. Can I change a mandate online?
Many banks now offer a secure portal for mandate changes. Check your banks digital banking platform for an Mandate Management section.
3. What if a signatory leaves the company?
Submit a change of mandate form immediately, removing the departing individual and adding a replacement if needed. Also, update any internal authorisation matrices.
4. Do I need to inform the bank of a change in the companys legal name?
Yes. A change of legal name requires a separate name change form and supporting statutory documents along with any mandate updates.
5. Is a notarised copy of the board resolution always required?
Not always, but many banks treat a notarised or certified copy as sufficient proof of authority. Verify the banks specific requirement in advance.
Sample Template (For Reference Only)
Below is a simple layout you can adapt. Always use the format supplied by your bank.
[Company Letterhead]Date: ______________________To: [Name of Bank] Branch ____________Subject: Change of Bank Mandate Account No. ____________1. ACCOUNT DETAILS Account Name: ______________________________________ Account Number: ___________________________________ Branch: ___________________________________________2. EXISTING MANDATE Signatory 1: ___________________ (Title) __________________ Signatory 2: ___________________ (Title) __________________ Current Transaction Limit: ___________________________3. PROPOSED CHANGES Add Signatory: ___________________ (Title) __________________ Remove Signatory: ___________________ (Title) __________________ New Transaction Limit: _______________________________ Additional Instructions: _______________________________4. SUPPORTING DOCUMENTS Board Resolution (attached) ID Proof of New Signatory (attached) Address Proof (attached)5. AUTHORIZATION ___________________________________ Date: __________ Existing Signatory 1 Signature & Name ___________________________________ Date: __________ Existing Signatory 2 Signature & Name ___________________________________ Date: __________ New Signatory Signature & NamePlease process the above changes at the earliest convenience and confirm once the new mandate is active.Thank you,[Authorized Persons Name][Designation][Contact Details]
Conclusion
Changing a bank mandate is a routine but critical task that ensures your organizations financial controls remain accurate and uptodate. By following the steps outlined above, preparing complete documentation, and avoiding common pitfalls, you can minimise delays and maintain smooth banking operations.
If you have any further questions, contact your relationship manager or visit the banks website for detailed guidelines.
