Mumbai: The Reserve Bank of India (RBI) has instructed banks to take swift action to address the growing number of inoperative or frozen accounts. The central bank aims to make it easier for customers to activate these accounts by simplifying the process.
To support this effort, RBI has advised banks to organize special campaigns focused on reactivating frozen accounts. Additionally, the RBI has encouraged banks to assist customers in updating their Aadhaar details at branches offering Aadhaar-related services. This initiative is designed to help individuals, especially from economically disadvantaged backgrounds, restore access to their accounts.
RBI said, "The banks may also organise special campaigns for facilitating activation of inoperative/frozen accounts. Besides, the banks may also facilitate Aadhaar updation for customers through the branches providing Aadhaar related services."
The central bank has also directed State Level Bankers' Committees (SLBCs) to closely monitor the situation in their respective regions, aiming to reduce customer inconvenience.
RBI emphasized that many frozen or inoperative accounts belong to individuals from weaker sections of society. Therefore, it urged banks to adopt a compassionate approach to make the process simpler for these customers. The RBI added, "The process of activation of such accounts should be smoother and hassle-free, including enabling seamless updation of KYC through mobile/internet banking, non-home branches, Video Customer Identification Process, etc."
Additionally, the RBI highlighted cases where accounts belonging to beneficiaries of government schemes such as Direct Benefit Transfer (DBT) or Electronic Benefit Transfer (EBT) had been frozen due to incomplete or outdated KYC details. The RBI has instructed banks to segregate these accounts and ensure that funds from DBT/EBT are credited without interruption, while efficiently addressing KYC-related concerns.
These measures are part of the RBI's broader initiative to enhance financial inclusion and remove obstacles for marginalized communities in accessing banking services. Banks have been urged to act swiftly and ensure a smooth resolution for customers facing account-related issues.
The rise in unclaimed deposits has been notable, increasing by 26 percent year-on-year, reaching Rs 78,213 crore by the end of March 2024.
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