Unclaimed deposits in bank savings accounts, Fixed Deposits (FDs): How to get your money back explained here
3 min read 22 May 2023, 12:55 PM ISTUnclaimed deposits in bank savings accounts, FDs: The primary reason for deposits becoming unclaimed is the death of the depositor/accountholder without leaving a nomination
PremiumThe Reserve Bank of India (RBI) recently announced 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. The banks will start the campaign on June 1.
What are unclaimed deposits?
The balances in savings or current accounts which are not been operated for 10 years, or term deposits not claimed within 10 years from the date of maturity are classified as 'Unclaimed Deposits'.
What happens to unclaimed deposits after 10 years?
These amounts are transferred by banks to the ‘Depositor Education and Awareness’ (DEA) Fund maintained by the Reserve Bank of India.
What are the reasons for their occurrence?
The primary reason for deposits becoming unclaimed is the death of the depositor/accountholder without leaving a nomination. Ankit Garg, Advocate & Founder of Garg Law Chambers (GLC) said most depositors while opening their accounts or even afterward do not carry out the necessary modifications for appointing a nominee in their accounts. In case of their demise, banks are required to follow the legal procedures before handing over the money to the legal heirs.
Other reasons may be a very low balance in the account or change of name or shifting of residence to another city or country, he added.
Which measures can individuals adopt to avoid their deposits from being classified as unclaimed ?
Ankit Garg listed out steps that individuals should take to avoid the risk of unclaimed deposits.
To avoid the risk of unclaimed deposits, individuals can take several important steps.
1) Addition of nominees
One of the most important steps is to appoint a nominee for their bank accounts or deposits. This ensures that if anything happens to the account holder, the nominee can claim the funds or assets without any delay.
2) Share bank accounts and deposits details with family members
It's also important to share the details of bank accounts and deposits with family members, so they are aware of the accounts and can access them in case of a mishap.
3) KYC (Know Your Customer) updation
Regularly updating KYC (Know Your Customer) details with the bank is crucial to receive regular communications and alerts from the bank. This helps to stay informed about any changes or updates related to the account or deposits.
4) Close all your extra accounts
Another important step is to close down any unwanted or extra accounts and maintain only 1-2 accounts for day-to-day living. This simplifies managing accounts and reduces the risk of losing track of one’s accounts.
5) Keeping fixed deposit (FD) slips safely
Finally, keeping FD (Fixed Deposit) slips safely is important as they serve as evidence of ownership and can be used to claim the funds at maturity. By following these steps, individuals can reduce the risk of unclaimed deposits and ensure that their hard-earned money is safe and easily accessible.
How to claim the unclaimed deposits?
Every bank is required to show the details of unclaimed accounts on its website, as per the RBI regulations. After checking the details on the website, customers can visit the bank branch with a duly filled claim form, and receipts of the deposits, and know your customer's (KYC) documents to claim the money.
How nominees can claim the unclaimed deposits
If you are the nominee, you need to visit the bank with the deposit receipts, identity proof, and a copy of the death certificate of the account holder. After verifying the claim, the bank will release the money.
According to a report in PTI, State Bank of India (SBI) tops the chart of unclaimed deposits worth ₹8,086 crore followed by Punjab National Bank ₹5,340 crore, Canara Bank ₹4,558 crore and Bank of Baroda ₹3,904 crore.
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