Try opening a current account for your company without one of these, and the bank will simply refuse the application. It doesn't matter how complete your other paperwork is — banks won't let a company account exist without a formal board resolution telling them exactly who's allowed to operate it. It sounds like a small formality, but get the wording wrong and you'll be back at the branch a second time with corrections.
Here's what actually goes into this document, why banks insist on it, and how to get it right the first time.
It's a written record of a decision made by your company's board of directors, formally approving the opening of a bank account and naming the people authorised to operate it — sign cheques, approve transfers, apply for internet banking, whatever the account will actually be used for. A company is a separate legal person under the Companies Act, and it can't walk into a branch and sign forms itself. Someone has to be given that authority on paper, and that's exactly what this resolution does.
Banks ask for it as part of their KYC and account-opening compliance. Without it, there's no documented proof that the individuals sitting across the desk actually have the power to act for the company, and no bank is going to take that on faith.
This isn't something a single director can sign off on their own, unless the company genuinely has just one director to begin with. It needs to go through a proper board meeting — or a resolution by circulation, where directors sign off individually rather than gathering in person — with quorum requirements met as per the company's Articles of Association and the Companies Act, 2013.
Once passed, the resolution is recorded in the minutes book, and a certified true copy — usually signed by the company secretary or a director — is what actually goes to the bank. The bank rarely wants the entire minutes book; they want that one certified extract.
A resolution that's too vague is one of the most common reasons banks send these back for correction. At minimum, it should spell out:
Miss the "individually or jointly" clause and you'll likely get asked to redo the whole thing, since it's exactly what tells the bank how transactions should actually be processed day to day.
Most of the document is fairly standard. The core resolution clause usually reads something close to this, adapted to your company's specifics:
"RESOLVED THAT a Current Account be opened in the name of [Company Name] with [Bank Name], [Branch Name], for the purpose of conducting the day-to-day banking transactions of the Company, and that [Name], [Designation], and [Name], [Designation], be and are hereby authorised to operate the said account [individually / jointly], including but not limited to signing cheques, making deposits and withdrawals, and availing internet banking facilities on behalf of the Company.
RESOLVED FURTHER THAT a certified copy of this resolution be furnished to the Bank, and that the Bank be authorised to act on the instructions of the said authorised signatories until written notice of any change is received by the Bank."
Banks often layer their own specific clauses on top of this, especially around indemnity and liability, so it's worth checking if your bank has a preferred format before finalising the wording.
Requirements vary slightly bank to bank, so it's worth calling the branch or checking their account-opening checklist before you show up, rather than assuming every bank wants exactly the same set.
Only if the company genuinely has just one director, such as certain One Person Companies. Otherwise, it needs to go through a proper board meeting or a valid resolution by circulation with quorum met.
Yes, most banks expect it printed on letterhead and signed by the required number of directors, typically two or more, along with the company seal if the company still uses one.
Generally yes. If your company plans to open accounts with more than one bank, most banks expect a resolution specific to that relationship rather than a shared, generic version.
The board needs to pass a fresh resolution updating or revoking that person's authority and share it with the bank. Leaving an outdated resolution on file means a former employee could technically still be recognised as authorised.
Both. The resolution establishes who has authority; the bank still separately verifies each signatory's identity and address through standard KYC documentation.
It stays valid until the board formally revokes or replaces it with a new one. There's no automatic expiry, which is exactly why outdated resolutions need to be actively updated rather than left as is.