Indian banks have over Rs. 1,360 crore unclaimed amount, enough to run Central government hospitals and dispensaries for a year or provide funds to farmers under the National Horticulture Mission.
Any bank account, not been operated for a decade, turns inoperative and the money is transferred to the bank’s suspense account. There are over one lakh inoperative accounts with Indian banks, each having on average Rs. 1,350, the RBI said in a RTI reply. Over 75 % of these accounts are of savings.
Although the Reserve Bank of India has asked banks to issue notices to account holders to take back the money back along with the interest, the banking regulatory is not willing to transfer the money to the government as done in case of unclaimed dividend from the companies.
"There is no scheme under consideration of RBI whereby such unclaimed deposits in banks including those in inoperative accounts may be transferred to some government account after a specified period," said D Mahapatra, RBI’s Central Public Information Officer.
After the RTI applicant Subhash Aggarwal sought information on money in suspense accounts, the RBI woke up and issued a new circular in July 2010 asking the banks to review the accounts where there have been no operations for more than a year and inform the account holder about the same in writing.
"Banks are taking every step to ensure that unclaimed money lying with them is safe and not misused," T M Bhasin, chairman and managing director, Indian Bank told Hindustan Times. Chairman of a public sector bank said in case of any transaction, which may happen after that period, will be monitored closely to ensure that there is no fraudulent activity.
The RBI has admitted that it has received complaints of customers facing problems in operating the accounts termed as inoperative and unwillingness of the banks to pay interest on the money in these accounts.
The country top-banking regulator has asked the banks to make all efforts to locate the customer and in case, it fails to find the person, the bank should contact the person who introduced the account holder. "Banks can consider a special drive to find the whereabouts of the customers," the RBI had said.
The nationalized banks have around Rs. 988 crore in inoperative banks followed by State Bank of India and Associate banks, private sector banks and foreign banks.