What is Bank Assignment?

What is Bank Assignment?Assignment means the transfer of any existing or future right, property, or debt by one person to another person.

The person who assigns the property is called ‘assignor’ and the person to whom it is transferred is called ‘assignee’.

Usually, assignments are made of actionable claims such as book debts, insurance claims etc.

In the banking business, a borrower may assign to the banker;

  1. the book debts,
  2. money due from a government department,
  3. insurance policies.

Related: Mortgage: Definition, Characteristics, Different Types of Mortgage

Assignments may be of two types:

  1. A legal assignment is an absolute transfer of an actionable claim. It must be in writing signed by the assignor, the assignor informs his debtor in writing intimating the assignee’s names and address. The assignee also gives a notice to the debtor and seeks a confirmation of the balance due.
  2. An equitable assignment is one which does not fulfill all the above requirements. In case of legal assignment, the assignee can sue in his own name. A legal assignee can also give a good discharge for l lie debt without the concurrence of the assignor.

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