Authorized Signatory Letter for the Bank

A signatory is a person or a party who signs the agreement with the company and becomes an active member of that company. In some cases, the signatory is given access to the bank account of the company when he has invested a significant amount in the company.

However, the bank cannot allow any person other than the account holder to carry out the transactions from an account. For business accounts, banks have different policies. For instance, they allow the account holder to authorize someone to carry out transactions from their account.

What is an authorized signatory letter to the bank?

It is a formal letter written to the concerned person in the bank to let him know that you are allowing someone to make monetary transactions from your account that was initially being monitored and controlled by you.

In this letter, you inform the bank that you have added a person in your company who you can allow to be the signatory. There is no need to provide the reason as to why you have added the signatory. However, make a clear statement about the authorization you are issuing.

Importance of this permission letter:

Banks have a lot of restrictions on an account of a person because it is the responsibility of the bank to ensure that the funds of the person are safe and secure in his account by not allowing anyone else to make money from that account.

When a bank receives the authorization letter from one of the account holders, it allows the said person to carry out the transaction. Without the permission letter, the signatory will never be able to take any action on the account.

The authorization letter also keeps a record of what authority you have given to the signatory. For instance, if the signatory is allowed to withdraw money from the account up to a certain limit, mention that limit so that when the signatory tries to exceed that limit, the bank can stop him from doing this.

How to write the authorized signatory letter to the bank:

When you are writing to the bank, you should make sure you read the following points before drafting your letter:

  • Be clear:

You should know that you are giving your consent to someone to withdraw money from your account on your behalf and this is something very critical.  Therefore, make sure that you use a clear statement to designate the authority to someone.

  • Be concise:

The bank is not interested in knowing why you are writing and what has compelled you to take this decision. Therefore, you don’t need to provide details that are not relevant. So, make sure that your letter conveys your consent and some other pertinent details without going off track and confusing the bank

  • Use professional language:

You are addressing an institute in your consent letter and therefore, your tone should be appropriate and professional. Learn to use professional language and draft a formal letter

Sample authorized signatory letter to the bank:

Subject: Authorisation of signatory addition

Dear Sir/Madam,

I would like to state that I am an account holder in your bank with (mention the account number) of type (mention the type of account whether saving or current) in the branch (mention the branch number and its location).

As per the decision of the company, Mr. ABC has been added as an authorized person or signatory. Mr. ABC is a new addition to our company and I would like to authorize him to carry out transactions regarding money as per the decision of the board.

I am enclosing all the necessary documents along with this letter and the copy of the decision taken by the board with respect to giving authorization. I would like to request you to add Mr. ABC as a signatory. I will be highly thankful to you for this act of kindness.

If you have any queries regarding this matter, you can contact me on (mention your phone number).


Name of the sender
Designation of the sender in the company
Name of the company

Signatures of the sender


Authorized Signatory Letter for the Bank

File: Word (.docx) 2007+ and iPad
Size 28 KB