Summary of RBI Circular on Inoperative Accounts/Unclaimed Deposits (Circular No. DOR.SOG (LEG).REC/64/09.08.024/2023-24 dated January 1, 2024)

PART I – PRELIMINARY

1. Definitions:
   • Defines terms like Bank Induced Transaction, Customer Induced Transaction, Financial Transaction, Inoperative Account, Non-Financial Transaction, Unclaimed Deposits, Unclaimed Deposit Reference Number (UDRN), etc.
2. Review of Accounts:
   • Banks are required to annually review accounts with no customer-induced transactions for over a year. If no response is received, efforts are made to locate the account holder or their nominee/legal heirs.

PART II – OPERATIONAL GUIDELINES

1. Activation of Inoperative Accounts:
   • Banks are directed to provide KYC updation facilities for activation of inoperative accounts. Accounts are activated only after adherence to KYC guidelines and with the second level of authorization.
2. Payment of Interest:
   • Interest on savings accounts shall be credited regularly irrespective of account operation status.
3. Levy of Charges:
   • Banks are prohibited from levying penal charges for non-maintenance of minimum balances in inoperative accounts. No charges are to be levied for activation of inoperative accounts.
4. Display of Unclaimed Deposits and Search Facility:
   • Banks are required to display details of unclaimed deposits on their websites or in branches, allowing the public to search for their unclaimed deposits using specified criteria.
5. Fraud Risk Management in Inoperative Accounts:
   • No debit transactions allowed in inoperative accounts without customer-induced activation. Banks must ensure data security to prevent unauthorized access to customer data.
6. Customer Awareness:
   • Banks are mandated to provide information on the activation process of inoperative accounts/unclaimed deposits and conduct regular awareness campaigns.

PART III – REPEAL PROVISIONS

Repeal of Previous Circulars:

• • Previous circulars on the subject issued by the Reserve Bank are repealed with the issuance of these instructions.

The circular aims to ensure the activation of inoperative accounts and the proper handling of unclaimed deposits, emphasizing customer protection and awareness.