Thread: Use it or lose it!

All dormant accounts will get closed and the money deposited in these accounts will be tranferred to Govt. fund. So before your a/c turns dormant activate it by mere crediting and debiting money as a process. Go to the nearest branch widthraw money from it, or use ATM/cash cards.

15months(inactivation of account)
18months(dormant account)..

check out with google to know these stuffs.

RBI guideline on dormant account for RRB. Similar directions also exist for scheduled banks.

RBI/2008-09/481/RPCD.CO.RRB.BC.No.108 /03.05.33/2008-09

May 22, 2009

All Regional Rural Banks

Dear Sir,

Unclaimed deposits and inoperative / dormant accounts in banks

In view of the increase in the amount of the unclaimed deposits with banks year after year and the inherent risk associated with such deposits, it is felt that banks should play a more pro-active role in finding the whereabouts of the account holders whose accounts have remained inoperative. Further, several complaints have been received in respect of difficulties faced by the customers on account of their accounts having been classified as inoperative. Moreover, there is a feeling that banks are undeservedly enjoying the unclaimed deposits, while paying no interest on it. Keeping these factors in view, it is advised that Regional Rural Banks (RRBs) may follow the instructions detailed below while dealing with inoperative / dormant accounts:

(i) RRBs should make an annual review of accounts in which there are no operations (i.e. no credit or debit other than crediting of periodic interest or debiting of service charges) for more than one year. The RRBs may approach the customers and inform them in writing that there has been no operation in their accounts and ascertain the reasons for the same. In case the non-operation in the account is due to shifting of the customers from the locality, they may be asked to provide the details of the new bank accounts to which the balance in the existing account could be transferred.

(ii) If the letters are returned undelivered, they may immediately be put on enquiry to find out the whereabouts of customers or their legal heirs in case they are deceased.

(iii) In case the whereabouts of the customers are not traceable, RRBs should consider contacting the persons who had introduced the account holder. They could also consider contacting the employer / or any other person whose details are available with them. They could also consider contacting the account holder telephonically in case his telephone number / Cell number has been furnished to the RRB. In case of Non Resident accounts, the RRB may also contact the account holders through email and obtain their confirmation of the details of the account.

(iv) A savings as well as current account should be treated as inoperative / dormant if there are no transactions in the account for over a period of two years. The accounts which have not been operated upon over a period of two years should be segregated and maintained in separate ledgers.

(v) In case any reply is given by the account holder giving the reasons for not operating the account, RRBs should continue classifying the same as an operative account for one more year within which period the account holder may be requested to operate the account. However, in case the account holder still does not operate the same during the extended period, RRBs should classify the same as inoperative account after the expiry of the extended period.

(vi) For the purpose of classifying an account as 'inoperative' both the type of transactions i.e. debit as well as credit transactions induced at the instance of customers as well as third party should be considered. However, the service charges levied by the RRB or interest credited by the bank should not be considered.

(vii) Further, the segregation of the inoperative accounts is from the point of view of reducing risk of frauds etc. However, the customer should not be inconvenienced in any way, just because his account has been rendered inoperative. The classification is there only to bring to the attention of dealing staff, the increased risk in the account. The transaction may be monitored at a higher level both from the point of view of preventing fraud and making a Suspicious Transactions Report. However, the entire process should remain un-noticeable by the customer.

(viii) Operation in such accounts may be allowed after due diligence as per risk category of the customer. Due diligence would mean ensuring genuineness of the transaction, verification of the signature and identity, etc. However, it has to be ensured that the customer is not inconvenienced as a result of extra care taken by the RRB.

(ix) There should not be any charge for activation of inoperative account.

(x) RRBs are also advised to ensure that the amounts lying in inoperative accounts ledger are properly audited by the internal auditors / statutory auditors of the bank.

(xi) Interest on savings bank accounts should be credited on regular basis whether the account is operative or not. If a Fixed Deposit Receipt matures and proceeds are unpaid, the amount left unclaimed with the RRB will attract savings bank rate of interest.

2. RRBs may also consider launching a special drive for finding the whereabouts of the customers / legal heirs in respect of existing accounts which have already been transferred to the separate ledger of 'inoperative accounts'.

Yours faithfully

(B.P.Vijayendra)
Chief General Manager

© Reserve Bank of India. All Rights Reserved.

yeah actually today we were discussing dormant accounts etc in office.. so i thought this would be nice to let people know what planning the Govt.

thanks for bringing the official news..

Another racket by Nationalised ( Public Sector Banks
Unilaterally deduct as "fine" Rs 20/= or Rs 33/=if the minimum balance
in SB account falls below Rs 1000 or Rs 500 any time any day in a month.
Say Balance was Rs 500/=
Every month Rs 20/= works out to Rs 240/=for an year and Interest
equivalent of 50%!!! or Rs 33 x 12 + Rs 396/= or 80% per annum !
You get 3 or 4% annual interest on S.B acct !!

I had min Rs 500/= ( dormant acct) in Syndicate Bank and suddenly the minimum was raised to Rs 1000/= wef 1st Sept 2010and for 4 months I lost Rs 132/= ( Rule was implemented retrospectively and also was charged closing charges Rs 110/=.

An user kept the more than the minimum balance and Bank deducted some jewel loan Interest on 31th March and the Balance reduced by Rs 10/= ( for min balance )
Bank deducted the "fine" ! ( SB of HYD)


Most banks have displayed this in Notice board now.
Also some Banks charge Rs 110/= for closing the account !!
( Not charged by Canara Bank )
2. To cancel a demand draft of Rs 150/= SB of India deducted Rs 100/= as cancellation charges !!!
3. For loss of cheque leaves Rs 3/= for each leaf is charged !
4. To attest your signature service charge Rs 20/= etc.

Originally Posted by essbebe

Another racket by Nationalised ( Public Sector Banks
Unilaterally deduct as "fine" Rs 20/= or Rs 33/=if the minimum balance
in SB account falls below Rs 1000 or Rs 500 any time any day in a month.
Say Balance was Rs 500/=
Every month Rs 20/= works out to Rs 240/=for an year and Interest
equivalent of 50%!!! or Rs 33 x 12 + Rs 396/= or 80% per annum !
You get 3 or 4% annual interest on S.B acct !!

I had min Rs 500/= ( dormant acct) in Syndicate Bank and suddenly the minimum was raised to Rs 1000/= wef 1st Sept 2010and for 4 months I lost Rs 132/= ( Rule was implemented retrospectively and also was charged closing charges Rs 110/=.

An user kept the more than the minimum balance and Bank deducted some jewel loan Interest on 31th March and the Balance reduced by Rs 10/= ( for min balance )
Bank deducted the "fine" ! ( SB of HYD)


Most banks have displayed this in Notice board now.
Also some Banks charge Rs 110/= for closing the account !!
( Not charged by Canara Bank )
2. To cancel a demand draft of Rs 150/= SB of India deducted Rs 100/= as cancellation charges !!!
3. For loss of cheque leaves Rs 3/= for each leaf is charged !
4. To attest your signature service charge Rs 20/= etc.

"please contact the RBI or the OMBUDSMAN of your Bank, if you have any complaints." banks cannot do anything against the rules prescribed by R.B.I.
now dont say OMBUDSMAN is no help..

Originally Posted by essbebe

Another racket by Nationalised ( Public Sector Banks
.

and btw no rackets by PSBs..

Correction :Annual Interest calculated for Rs 100/= as minimum balance .

If RBI .circular/s are applicable to PSB's
How Each PSB decides on the "fine "( service Charge/penalty ) Rs 20/= ( Canara Bank ) Rs 33/= Syndicate bank ( for example ).

Canara Bank does not deduct Rs 110/= for closing an account, but Syndicate Bank did !
Can RBI take punitive action on such banks ?
No.Banks are free to decide on the Interest they pay for FD's, service charges etc. '"Bank Autonomy'" applies !
Easy to "pass the buck" back to RBI!!

and btw no rackets by PSBs

Who could forget "Harshad Mehta" racket( scandal) !
Banks advanced crores to an Individual to manipulate the stock market !

2G spectrum Scandal. SBI reportedly advanced crores as Advance on a piece of paper. Grant of Spectrum license. Infrastructure (other assets NIL !!!) !!!
If no rackets Banks will not have NON performing assets, and write off crores every year, Advance loans on" Imitation gold " or "dud" land documents.

Originally Posted by essbebe

Who could forget "Harshad Mehta" racket( scandal) !
.

some top guys of all spheres are that corrupt, so dont generalise..

i am still telling you to file a complaint against the banks, and you will be heard.. Contact Ombudsman..

Originally Posted by essbebe

Easy to "pass the buck" back to RBI!!




"Harshad Mehta"

yeah... its nice when you have the big-bro backing all your actions.. (no bad feelings please, just joking)

and for Harshad Mehta:- as a reputed bank's employee i am told to forget this guy..

banks are free to follow either Minimum Balance (fixed value at all points of time, simple to understand and calculate) or Minimum Average Quarterly Balance (a mathematical calculation based on average of daily closing balances, much beyond the understanding of common man).
Normally PSU Banks MB method which is very clearly displayed and only deduct token penalty of less than Rs.50 for non-maintenance. Private Banks generally follow MAQB and promptly deduct Rs.500 to Rs.600 in fines if a customer fails to maintain MAQB.

Earlier bank employees used to open thick ledgers, calculate the interest, and enter it in those fat ledgers, and get fatigued.
Now they will get "Silent Carpal syndrome' by operating the computer for opening the accounts, for the computer to enter the interest/etc including for dormant accts. .
Not only this. RBI suspects/ fears foul play by the employees and money can be siphoned offfrom "Dead" and dormant accounts..
Specimen signature is available in the computer !!!

Simple method. If an account is inactive for say 6 months, simply send by Money order the Balance amount with Interest to the address
last given. Of course Bank employees are so busy, that they will not try to contact you on Phone or cellphone OR send a Postcard ( printed format ) to warn you that the Bank will start deducting fines for
not keeping the account active.

Even this the computer can do. ( print out letters with address also )

My money when I entrust to the Bank,it is expected it will be returned without any fancy Service charges/ fine/ etc and also charge for closing the account ( which is NEVER mentioned , when you open an account :
Either in the application form prominently or by the staff/ Bank Manager.)

All dormant accounts will get closed and the money deposited in these accounts will be transferred to Govt. fund.

So transferring it to Govt acct is pure/plain Robbery or a racket or a another mega swindle !!!

well, cannot understand why a person cannot keep his a/c active. you see its 1.5 years thats the account goes dormant. thats a long time. and if you cannot keep your account ok thats your problem. new economic policies are created in such a way because these inactive accounts create alot of problem for maintainence of bank's accounting systems. such accounts could be said as unclaimed. major part of the work is still done on manual basis and without the use of internet and cash cards in our country, so the database is increasing by a big margin.
there are also possibilities that maybe such inactive accounts could be a haven for black money.

and i promise you, once this rule is applied people will learn from it. we must make rules so that people dont create unwanted accounts. the problem is no problem transaction of money and thats all.