RBI Launches Scheme to Activate Inoperative Accounts and Settle Unclaimed Deposits

Context:

The Reserve Bank of India (RBI) has launched a one-year incentive scheme (October 2025 – September 2026) to encourage banks to reactivate inoperative accounts and repay unclaimed deposits to rightful claimants.

What is an Inoperative Account?

• A bank savings/current account that has had no customer-initiated transactions for 2 years (as per RBI guidelines).
• Balance remains but account is inactive until reactivated by the customer.

Key Highlights:

• Incentives for Banks:
  • Banks will receive 5%–7.5% of amounts (up to ₹25,000) for:
    • Reactivating inoperative accounts.
    • Settling unclaimed deposits with legitimate owners.
  • Payouts are linked to:
    • Account age – older inoperative accounts may attract higher incentives.
    • Deposit size – larger unclaimed amounts may receive proportionate rewards.
• Objective:
  • Reduce the stock of dormant/inoperative accounts in the banking system.
  • Ensure depositors receive their rightful funds, improving customer trust in banks.