`9,000CR BANK DEPOSITS STILL UNCLAIMED

RTI inquiry reveals a nine-fold jump in amount since 2005

A Right to Information (RTI) petition has revealed that, as per government data, unclaimed deposits in banks across India amounted to nearly `9,000 crore, at the end of 2016, signalling a ninefold jump since 2005.

The majority of unclaimed deposits are reportedly a result of the deaths of depositors.

The Reserve Bank of India (RBI) has directed banks to categorise accounts that have remained inoperative for 10 years as ‘unclaimed deposits’.

Between 2005 and 2016, the amount lying in unclaimed deposits has increased from `930 crore to `8,865 crore.

A right to information (RTI) petition has revealed that, as per government data, unclaimed deposits in banks across India amounted to nearly `9,000 crore, at the end of 2016, signalling a ninefold jump since 2005. The majority of unclaimed deposits are reportedly a result of the deaths of depositors. The Reserve Bank of India (RBI) has directed banks to categorise accounts that have remained inoperative for 10 years as ‘unclaimed deposits’.

According to Union ministry of finance data, between 2005 and 2016, the amount lying in unclaimed deposits has increased from `930 crore to `8,865 crore. Except for 2014, the amount of unclaimed deposits has increased every year. However, the number of such accounts has not increased at the same rate.

D. Rakesh Reddy, who filed the RTI petition, said, “The prime reason for accounts to become inoperative and subsequently fall in the unclaimed category is the death of the account holder. Second, people shift to a new location and the account in the old branch is not operated. Therefore, the RBI has asked banks to find the whereabouts of customers or their legal heirs in case they are deceased and seek reasons for not operating the account.”

Banks are supposed to conduct an annual review of accounts which have not been operated for more than a year.

In case a customer is untraceable, banks should contact the persons who introduced the customer. They could also contact the customer’s employer or any other relevant person whose details are available with them.

In case the account holder remains untraceable despite all efforts, the money is deposited into the ‘Depositor Education and Awareness Fund’ as per Section 26A of the Banking Regulation Act established by the RBI. Any amount unclaimed for more than 10 years has to be credited to this fund within three months from the expiry of said period. The fund is to be utilised to promote depositors’ interests.

However, a depositor is entitled to claim any unclaimed amount even after the amount has been transferred to the fund at a rate of 4 per cent simple interest, paid by the bank.