RBI plans to use unclaimed deposits for education, awareness

Apex bank plans to use Rs 3,500 cr such deposits that have not been claimed for 10 years for the purpose

The Reserve Bank of India (RBI) on Tuesday proposed unclaimed bank deposits, estimated at about Rs 3,500 crore, be used for education and awareness among depositors.

According to a draft on the Depositor Education and Awareness Fund Scheme, deposits in the banking sector that haven’t been claimed for at least 10 years will be transferred towards the scheme.

RBI said the amount to be credited to the fund would be credit balances in bank deposit accounts that hadn’t been operated upon for at least 10 years, or any amount that remained unclaimed for at least 10 years. These accounts include savings bank deposit accounts, fixed or term deposit accounts and current deposit accounts.

The draft also said there would be a provision to reclaim the amount, as appropriated by the fund.

RBI said any amount in foreign currency, payable under an instrument or a transaction, which was unclaimed for at least 10 years would be converted into rupees at the exchange rate prevailing on the date of conversion, and transferred to the fund. In case of a claim, the fund would be liable to refund in rupees.

The central bank also said there would be a committee to administer and manage the fund. This committee would comprise not more than 11 members, as decided by RBI.

An RBI deputy governor, nominated by the governor, would be the ex-officio chairperson of the committee, RBI said.

The funds would be used to promote the interests of depositors. For this, the committee may register/recognise various institutions, organisations or associations engaged in activities related to depositor awareness and education, from time to time.

Before authorising the release of funds, the committee may examine the proposals and the proposed end uses of the grants. It may also seek information on, or verify, the end use of funds granted to such institutions. RBI said the committee might also take action, , including legal action, deemed necessary and in the interests of the fund, including legal actions, as and when considered appropriate, said RBI.