Over the next three months, we can expect the banks to step up in their efforts to return unclaimed deposits to rightful owners, nominees, or heirs as the Reserve Bank of India (RBI) has asked the same.
RBI Ordered Banks To Return Unclaimed Deposits
It appears that the country’s central bank has set October to December 2025 as a focused period for clearing pending claims and reactivating dormant accounts reportedly.
This order is applicable to all the unclaimed deposits that are balances in savings or current accounts that have not seen any activity for 10 years, or term deposits that remain unclaimed for 10 years after maturity.
If we consider the procedure, these types of funds are transferred to the Depositor Education and Awareness (DEA) Fund which are managed by the RBI.
Please note here that the claimants can access them at any time by approaching their banks.
Moving ahead, the size of unclaimed deposits is rising sharply, as per the RBI data.
The unclaimed balances stood at about Rs 78,213 crore as of March 2024, marking a nearly 26 percent jump over the previous year.
The RBI seems to have recently revised rules on inoperative accounts and unclaimed deposits in its latest drive.
Basically they are implementing these changes in efforts in making it easier for customers to update KYC (Know Your Customer) documents and claim funds.
Under these upgrades, the customers can complete KYC updates at any bank branch, through video-based verification (V-CIP), or with the help of business correspondents (BCs) in their local area.
How Does This Helps?
Besides this, the central bank is also promoting its UDGAM portal (Unclaimed Deposits – Gateway to Access Information), as it allows individuals to check if they have unclaimed deposits across multiple banks using a single online search.
So far, more than 8.5 lakh users have already accessed the platform after its launch.
In addition to this, it also helps in cleaning up the bank balance sheets, as unclaimed deposits remain a liability for banks.
This will also help in improving the customer welfare, returning idle funds to their rightful owners.
It will also support the financial inclusion and trust, especially for families who may not know about dormant accounts of deceased relatives.
Banks will face heavy operational pressure to process claims and verify documents within three months.
It also involves some fraud risks, as relaxed KYC processes such as video verification may attract false claims.
It seems that the lack of awareness among customers remains a hurdle, especially in rural areas where people may not know about dormant accounts.
