UNCLAIMED BANK DEPOSITS

UNCLAIMED BANK DEPOSITS

TOPIC: Economy

Context- There is a huge sum of money lying unclaimed with banks which needs to be reclaimed.

Concept-

Unclaimed Deposits:

• Unclaimed deposits are defined as those deposits which are lying in accounts not operated for a period of 10 or more years.
• Public sector banks have a higher percentage of unclaimed deposits.
• Section 26 of the Banking Regulation Act, 1949 requires banks to submit to RBI information about these accounts within 30 days after each calendar year ends.
• Unclaimed deposits can be claimed by their legal owners after satisfying certain conditions prescribed by RBI.
• As per Section 26A of the amended Banking Regulation Act, 1949, money lying in dormant bank accounts is transferred to the Depositor Education and Awareness Fund (DEAF) within a period of three months from the expiry of the above-said 10 years.
  • The Depositor Education and Awareness Fund Scheme (DEAF Scheme) was established by the Reserve Bank of India (RBI) in 2014 for the promotion of depositors’ interest and for any other related purposes deemed necessary by the RBI.
• The depositor is, however, entitled to claim from the bank her/his deposit or any other unclaimed amount or operate the account after the expiry of 10 years, even after such amount has been transferred to DEAF.