RBI Urges Banks to Launch Campaigns for Activating Frozen Accounts
The Reserve Bank of India (RBI) has asked banks to take immediate steps to reduce the number of inoperative or frozen accounts and to make the activation process smoother and hassle-free.
The RBI has advised banks to organize special campaigns focused on activating inoperative or frozen accounts.
Moreover, it has advised the banks to assist customers at branch level which provide Aadhaar-related services, in updation of Aadhaar at such branches so that the account holders who come from backward classes are eased to reactivate their accounts.
According to RBI "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".
It has also provided individual instructions to State Level Bankers' Committees (SLBCs) to proactively monitor the situation in their respective regions to ensure that customer inconvenience is minimal.
The RBI has, while emphasizing the significance of this move, pointed out that frozen or inoperative accounts majorly belong to people belonging to economically weaker sections.
Central bank urges banks to become more sensitive and make processes easy for such customers.
It added "the process of activation of such accounts smoother and hassle free, including by enabling seamless updation of KYC through mobile/internet banking, non-home branches, Video Customer Identification Process, etc".
The RBI also highlighted cases where bank accounts of beneficiaries under such government schemes as Direct Benefit Transfer (DBT) or Electronic Benefit Transfer (EBT) were frozen waiting for pending or periodic updates of KYC.
The central bank has instructed banks to segregate these accounts and ensure uninterrupted credit of DBT/EBT funds while addressing KYC-related issues efficiently.
These steps are part of RBI's broader efforts to improve financial inclusion and reduce barriers for marginalized sections of society in accessing banking services. Banks have been urged to act urgently and ensure customer convenience in resolving account-related issues.
Unclaimed deposits in banks increased by 26 per cent year-on-year at Rs 78,213 crore as of March 2024 end.
