RBI asks banks to do periodic review of unclaimed deposits

Reserve Bank of India

The Reserve Bank of India (RBI) on January 1 issued guidelines for the banks on unclaimed deposits and asked them to do periodic reviews.

An unclaimed deposit is an account, which does not see any activity like the infusion of funds, withdrawal, etc. from the depositor for 10 years or more and is deemed as an inactive deposit.

The RBI has also asked banks to take measures to prevent fraud in such accounts/deposits, and grievance redressal mechanism for expeditious resolution of complaints, the release said.

Banks also have to take steps for tracing the customers of inoperative accounts/ unclaimed deposits including their nominees/ legal heirs for re-activation of accounts, settlement of claims or closure and the process to be followed by them, the release added.

The central bank said that these instructions are expected to complement the ongoing efforts and initiatives taken by banks to reduce the quantum of unclaimed deposits in the banking system and return such deposits to their rightful owners/claimants.

The instruction issued by the RBI will apply to commercial banks (including regional rural banks) and all cooperative banks, the release added.

To track all unclaimed deposits, the RBI in August 2023, launched the UDGAM portal. It is a centralised portal which helps people to track all their unclaimed deposits across different banks in one place.

Before UDGAM, one would have to search for such deposits individually on each bank’s website.

In May 2023, the central bank launched a ‘100 Days 100 Pays’ campaign for banks to trace and settle the top 100 unclaimed deposits of every bank in every district of the country within 100 days.

"This measure will complement the ongoing efforts and initiatives by the Reserve Bank to reduce the quantum of unclaimed deposits in the banking system and return such deposits to their rightful owners/claimants," teh RBI said.