Bank mandate as defined by investorwords.com “is a written order to a bank, asking it to open an account and allow someone to sign cheques on behalf of the account holder, and giving specimen signatures and relevant information”.
A bank mandate, also known as an signing authority, sets out who can use an account, including who can access information about it
A mandate is very straight forward if you are the only one operating an account. A little care is needed if there are two or more account holders, or if you let someone else operate the account.
A mandate sets out who owns the account. These individuals are often called ‘account holders’ or ‘account owners’. The mandate also sets out who can operate the account and what access they have. Bankomb.org.nz
Types Of Bank Mandate
Sole Signatory – This will apply to a personal account or any other type of account where the account owner or prime mover of the account chooses to sign alone. It mean cheques or any other correspondents to the bank in respect of the account must be signed by the sole signatory to the account and no one else.
Joint Signatory – This refer to a bank mandate on any account type where the account holder/s chooses to have more than one person as signatory to the account. A personal account holder may choose to join his or her spouse or any other relative as authorized signatory to sign the account with him/her. Directors or shareholder of a corporate account can also be joint signatories to a corporate account.
For an account with a joint mandate, power may be assigned to one or more of the partners more than the other/s. A partner can have powers to sign alone or up to a specific amount while other may sign jointly and also with limits.
SEE: All You Need To Know About Joint Account
Either to sign – Another bank mandate can have two signatories having equal powers to sign and make demands on the bank. In this case the two signatories to the can write independently to make demands on the bank and the bank will have no choice but to honor such request.
Others – A bank account mandate can have 3 or more signatories and can be ALL TO SIGN, ANY TO SIGN, ANY TWO TO SIGN, ANY THREE TO SIGN and lots more. The mandate can also have amount limits attached to the mandate types.
It is important to note that the bank will only recognize correspondence with it on any account base on the mandate that exist on such account