Rs 1,723 cr unclaimed amount lying with banks: FM

The government today said that more than Rs 1,700 crore is lying unclaimed with various banks in the country.

The amount of unclaimed deposits was Rs 1,723.24 crore in 1.03 crore non-operational accounts in banks as on December 31, 2010, Finance Minister Pranab Mukherjee said in a written reply to the Rajya Sabha.

The amount of unclaimed deposits lies with the respective banks and is utilised by them for their general business like any other deposits, he said.

However, he said the government has conceived a proposal, in consultation with RBI, which involves amendment of the Banking Regulation Act, 1949, providing that the deposit accounts which have not been operated upon for a period of 10 years or any amount remaining unclaimed with any bank for more than 10 years will be credited to a Depositors Education and Awareness Fund.

The fund will be utilised for promotion of depositors' interest and for such other purposes may be specified by RBI from time to time, he said.

In a separate response, Mukherjee said that the RBI has not given any opinion that teaser home loans should be withdrawn by banks.

However, RBI has sensitised the banks of the risk involved in teaser home loans and prescribed higher rate of standard asset provisioning of 2% instead of 0.4% as a risk mitigation measure, he added.