How to Claim Unclaimed Bank Savings Accounts, Fixed Deposits (FDs)

As of December 2016, there is reportedly more than Rs. 8,800 crores lying unclaimed in over 2.5 crore bank accounts in India. Thankfully, the Reserve Bank of India has set certain guidelines to address this issue of unclaimed deposits and inoperative accounts, to help people get their money back. All the banks in the country are required to follow these rules and ensure that the process of claiming unclaimed deposits goes without a hitch.

Unclaimed deposits are deposits where the proceeds/maturity amount has not been claimed for a period of 10 years or more. In other words,term deposits are deemed unclaimed if they are inactive/inoperative for more than 10 years.The same holds good for accounts too.

The first thing that will happen to the unclaimed fixed deposits and inoperative bank accounts that have seen zero activity for 10 years, is they will be transferred to the bank’s head office.

Then, either of the two situations will happen:

• Provided the term deposits are matured and the proceeds are unpaid, the amount left unclaimed with the bank shall attract rate of interest as applicable to savings account or the contracted rate of interest on the matured TD, whichever is lower.
• The funds may be transferred to the Deposit Education and Awareness Fund. It mainly comprises of inactive term deposits and accounts that have not been operated or claimed for 10 years. Banks are required to transfer balances from these dormant accounts to the Fund in each calendar month.

In either case, it is possible to claim the unclaimed funds. As stated above, the RBI has made it easy for people to get these funds. All banks are required to display the inactive bank account and term deposits details on their websites. The list must contain the names of the account holders and their address only.

Certain banks also provide search criteria like PAN card details, date of birth, name and telephone number, et cetera, to help users refine their searches. In addition to this, banks are required to clearly state the procedure to claim the funds on their websites. Therefore, you can visit the bank’s site and search for the unclaimed account/deposits right there.

The first thing you need to do is visit the nearest branch of your bank and submit the unclaimed deposits claim form.

There are four possible scenarios where you will be allowed to claim the funds:

• It is for yourself
• You are the nominee
• You are the legal heir
• Other reason

In either case, you must attach the relevant documents with your form which prove that you are indeed the legal heir/nominee/owner of the unclaimed account. Keep in mind that the bank will scrutinize your documents and verify them before the claim can be settled. Therefore, you must submit authentic, original papers, along with the identity and address proof.

For instance, if you are the legal heir of the original account holder, you will be asked to submit the proof that establishes you as the heir, along with the death certificate of the deceased. Similarly, if you are claiming funds from a company/institution’s account, you will need to submit the request on the official letterhead of the firm in question, with signatures from necessary authorities.

Once the validity and authenticity of the claim are verified, it is considered settled and the status of the account/deposit is changed from inactive to regular.

It is quite convenient to claim unclaimed deposits from banks, provided you have a legitimate cause to do so. A simple search on the bank’s website will tell you if you or any of your family members have an inactive/unclaimed account. If you want to claim the funds, you will be asked to furnish all the necessary documents that, in turn, will be verified before the claim can be settled.

Addition of Nominees: Adding nominees to your bank accounts and deposits is a crucial step to prevent them from being classified as unclaimed. By nominating individuals who would inherit the funds in case of your unfortunate demise, you ensure that the rightful beneficiaries have access to the funds without unnecessary delays. Nomination simplifies the process and helps your family members avoid the complexities associated with proving their claim.

Sharing Bank Account and Deposit Details with Family Members: Open communication with your family members about your bank accounts and deposit details is essential. By sharing this information, your loved ones will be aware of the various accounts you hold and will be better equipped to manage them in case of unforeseen circumstances. This proactive approach can significantly reduce the chances of your funds being deemed unclaimed.

KYC (Know Your Customer) Updation: Regularly updating your KYC details with your bank is not only a regulatory requirement but also a prudent measure to prevent your deposits from becoming unclaimed. KYC ensures that your contact information, address, and other pertinent details are accurate and up to date, facilitating smoother communication between the bank and yourself or your nominees.

Closing All Your Extra Accounts: Having multiple bank accounts that you no longer actively use can increase the risk of funds becoming unclaimed. It's advisable to periodically review your accounts and close those that are redundant. Consolidating your funds into a few active accounts not only simplifies your financial management but also reduces the likelihood of any account falling into the unclaimed category.

Keeping Fixed Deposit (FD) Slips Safely: When you invest in fixed deposits (FDs), it's imperative to keep the FD slips safe and accessible. These documents serve as evidence of your investments and can be crucial for your nominees or beneficiaries to claim the funds. Storing these slips in a secure location and informing your family members about their whereabouts can ensure a seamless process in case the FD needs to be claimed.

Unclaimed funds can lead to complications for your loved ones and create unnecessary financial stress during challenging times. By taking these measures, you proactively safeguard your deposits, ensuring that they remain accessible and beneficial for you and your family. Regularly reviewing and updating your financial information, sharing it with trusted family members, and adhering to regulatory requirements contribute to a comprehensive approach in preventing your deposits from being classified as unclaimed.