What Happens to Unclaimed Deposits in Banks ? How To claim It?

Lost and Found: What Happens to Your Forgotten Bank Money in India? Have you ever moved cities, changed jobs, or simply opened a bank accoun...

Lost and Found: What Happens to Your Forgotten Bank Money in India?

Have you ever moved cities, changed jobs, or simply opened a bank account for a specific purpose and then, over time, completely forgotten about it? You're not alone. Millions of people in India have funds lying dormant in old bank accounts, and the total amount is surprisingly large – exceeding ₹78,000 crore. This might seem like a lost cause, but the good news is that this money isn't gone forever. The Reserve Bank of India (RBI) has put in place a system to safeguard these funds, and the rightful owners or their legal heirs can still claim them.

What are Unclaimed Deposits? The RBI's Definition: Ten Years of Silence

To understand what happens to this forgotten money, it's crucial to know how the RBI defines it. According to the central banking authority, any money in a savings or current account that hasn't seen any activity for 10 years, or a term deposit that hasn't been claimed within 10 years after it matured, is classified as an "Unclaimed Deposit".6 This definition is consistent across various banking platforms and news reports, establishing it as the standard guideline in India. This extended period of inactivity signifies a very low likelihood of the account being actively used by its owner. The RBI likely set this threshold to strike a balance between considering an account truly abandoned and providing ample time for genuine account holders to come forward. A shorter timeframe might lead to accounts being prematurely classified as unclaimed, causing unnecessary inconvenience. This definition encompasses various types of bank accounts, including the everyday savings accounts we use, current accounts typically used for business, and fixed or term deposits where money is locked in for a specific period. Importantly, even after these deposits are classified as unclaimed, the original depositors or their rightful heirs still retain the right to claim this money.

The Journey of Unclaimed Money: From Your Account to RBI's Safe Hands

So, what exactly is the path that your forgotten funds take? It starts with a period of inactivity. Banks are mandated to conduct yearly reviews of accounts that haven't seen any customer-initiated transactions for more than a year.6 This annual review is a proactive measure to identify accounts that might be slipping into dormancy. Following this review, banks are supposed to reach out to customers via various channels like email, letters, or SMS if their account hasn't been used for a year.6 These alerts serve as a crucial reminder for customers who might have unintentionally stopped using their accounts. It also gives them an opportunity to take action and prevent their accounts from becoming inoperative. An account is typically labeled as 'inoperative' after two years of no customer-initiated transactions.18 It's important to note that only transactions initiated by the customer count towards activity. Bank-initiated actions, such as crediting interest or debiting service charges, do not prevent an account from being classified as inoperative.18 This distinction is vital for understanding how the inactivity period is calculated. If a savings or current account remains in this inoperative state for a total of 10 years, or if a term deposit remains unclaimed for 10 years after its maturity, the bank is then required to transfer the funds to the "Depositor Education and Awareness" (DEA) Fund.6 This transfer to the DEA Fund happens on the last working day of the month that follows the completion of 10 years of the account being continuously inoperative.32 Furthermore, the bank doesn't just transfer the original amount; it also includes any interest that has accrued on the deposit up to the date of the transfer.32 This entire process ensures that these forgotten funds are moved to a secure, centralized location managed by the RBI.6 This centralized system, rather than allowing the funds to remain indefinitely within individual banks, makes it easier for the RBI to oversee and potentially facilitate their return to the rightful owners.

RBI's Role and the DEA Fund: Your Money's Safe Haven

The "Depositor Education and Awareness" (DEA) Fund is a crucial entity in this process, and it is maintained and operated by the Reserve Bank of India (RBI).1 The fund was established in 2014, with its legal basis in Section 26A of the Banking Regulation Act of 1949.12 While the DEA Fund acts as a central repository for unclaimed deposits, its primary objective goes beyond just holding onto this money. The main goal is to utilize these funds to promote the interests of depositors across the country through various initiatives focused on financial literacy and awareness.7 This means the money isn't just sitting idle; it's being used to educate the public about banking practices, their rights as depositors, and how to manage their finances effectively.1 Despite the transfer of funds to the DEA Fund, it's vital to understand that depositors still retain their right to claim their money. Even after a decade of inactivity and the subsequent transfer, the original depositor or their legal heirs can still approach the bank where the deposit was initially held and claim the funds, along with any interest that was applicable.6 In fact, there is no specific time limit set for claiming these funds from the DEA Fund.17 This ensures that individuals don't lose their hard-earned money simply due to the passage of time or a lapse in memory. Recognizing the growing volume of unclaimed deposits, the RBI has also been actively taking steps to address this issue. One notable initiative is the '100 Days 100 Pays' campaign launched in 2023.4 This campaign specifically tasked banks with tracing and settling the top 100 unclaimed deposits in every district of the country within a 100-day timeframe.4 While the initial deadline was set, it was later extended to April 1, 2024.6 This initiative clearly demonstrates a proactive stance by the RBI to tackle the issue head-on and encourage banks to actively seek out and return these forgotten funds to their rightful owners.

Is Your Money There? How to Check for Unclaimed Deposits

Finding out if you have any unclaimed deposits has become significantly easier in recent times, thanks to the efforts of the RBI. The primary tool for this is the UDGAM (Unclaimed Deposits Gateway to Access Information) portal, launched by the RBI in 2023.1 This is a centralized web portal that allows the public to search for unclaimed deposits across multiple banks all in one place.1 As of March 2024, the portal included details of unclaimed deposits from 30 banks, covering approximately 90% of the total value of unclaimed deposits held in the DEA Fund.6 The RBI is continuously working to onboard more banks to this platform.49 This centralized approach marks a significant improvement, as it eliminates the need for individuals to check the websites of numerous banks individually, saving considerable time and effort.How to Use UDGAM (Step-by-Step): 6

1. Visit the UDGAM Portal: Go to https://udgam.rbi.org.in/unclaimed-deposits/#/login.6

2. Register: Click on 'Register' to create an account. You'll need to provide your mobile number, name, and set a password. Make sure to agree to the disclaimer and privacy policy.6

3. Verify and Log In: You will receive an OTP (One-Time Password) on your registered mobile number. Enter this OTP to verify your registration and then log in using your mobile number and password.6

4. Enter Account Holder's Name: Provide the name of the person or entity whose unclaimed deposit you are searching for. Ensure the name is entered as it would appear in the bank records.6

5. Select Bank(s): Choose the specific bank(s) where you suspect the deposit might be held. You have the option to select multiple banks or simply choose 'All Banks' to search across all participating banks.6

6. Provide Identification Details: To narrow down your search, you will need to enter at least one of the following details for the account holder: PAN (Permanent Account Number), Voter ID, Driving License Number, Passport Number, or Date of Birth.6

7. Search: Once you have entered the required information, click the 'Search' button to initiate the process.6

8. Review Results: The portal will then display details of any unclaimed deposits that match the information you provided. This will typically include the name of the bank and a link to the bank's website where you can initiate the claim process.6

While UDGAM is a powerful tool, it's also worth noting that banks themselves are required to display lists of unclaimed deposits (those inactive for 10 years or more) on their respective websites.1 These lists usually contain the name and address (without the PIN code) of the account holder.18 Many banks also provide a search function directly on their websites, allowing you to easily check for unclaimed deposits by entering relevant details.6 Therefore, if you have a strong suspicion about a particular bank where you or a family member might have held an account, checking their website could be another useful avenue.

Table: How to Search for Unclaimed Deposits Using UDGAM

Step	Action	Details
1	Visit the UDGAM Portal	Go to https://udgam.rbi.org.in/unclaimed-deposits/#/login
2	Register	Click 'Register', enter your mobile number, name, and create a password. Agree to the terms and conditions.
3	Verify and Log In	Enter the OTP received on your mobile and click 'Register'. Then, log in with your mobile number and password.
4	Enter Account Holder's Name	Provide the name as it appears in the bank records.
5	Select Bank(s)	Choose the bank(s) where you suspect the deposit might be, or select 'All Banks'.
6	Provide Identification Details (Any One or More)	Enter your PAN, Voter ID, Driving License Number, Passport Number, or Date of Birth.
7	Search	Click the 'Search' button.
8	Review Results	The portal will display any matching unclaimed deposits, including the bank name and a link to the bank's website for the claim process.

Claiming What's Yours: The Simple Steps to Get Your Money Back

Once you have successfully identified an unclaimed deposit, the next crucial step is to actually claim it. While the UDGAM portal helps you find the deposit, the claim process itself needs to be initiated directly with the specific bank where the account was held.6 Here's a general outline of the process you'll typically need to follow:

1. Visit the Bank Branch: The first step is to visit the branch of the bank where the unclaimed deposit is held.6 It's usually advisable to visit the branch where you originally held the account, if you remember it. However, most banks will allow you to initiate the claim at any of their branches.

2. Fill the Claim Form: Request a “claim form” for unclaimed deposits from the bank officials. You will need to fill this form with all the necessary details about yourself, the old account (if you remember the account number or any other details), and provide your current contact information.6 Many banks also provide this claim form for download on their websites.45

3. Submit Required Documents: Along with the filled claim form, you will need to submit certain documents to the bank for verification.6 The specific documents required may vary slightly from bank to bank, but generally include:

• Proof of Identity: This could be your PAN card, Aadhaar card, Passport, Driving License, Voter ID, or NREGA Card.6

• Address Proof: You will need to provide a valid address proof, such as your Aadhaar card, electricity bill, water bill, house tax receipt, or a recent bank statement.6

• Passport-sized photographs: Usually, you will need to submit a couple of recent passport-sized photographs.

• Passbook or Term Deposit Receipt: If you still have the old passbook or the term deposit receipt, it's helpful to submit it as proof of your previous account.6

• For Legal Heirs: If you are claiming the deposit as a legal heir of a deceased account holder, you will also need to submit a copy of the death certificate and other relevant legal documents such as a succession certificate or a legal heir certificate.6 The specific requirements for legal heirs might vary depending on the amount of the deposit and the bank's policies.

• Bank Details for Transfer: You will likely need to provide a cancelled cheque or a copy of your passbook for the account where you want the unclaimed funds to be transferred.7

4. Verification and Release of Funds: Once you have submitted the claim form and all the necessary documents, the bank will initiate a verification process.6 This process might take some time as the bank needs to ensure the legitimacy of your claim, especially for accounts that have been inactive for a long period. After the bank is satisfied with the verification, they will release the funds to you, along with any applicable interest that has accrued on the deposit.6 Following this, the bank will then claim a refund for this amount from the DEA Fund that is maintained by the RBI.7

Table: Documents Required to Claim Unclaimed Deposits

Category	Document Examples
Proof of Identity	PAN card, Aadhaar card, Passport, Driving License, Voter ID, NREGA Card
Address Proof	Aadhaar card, Electricity bill, Water bill, House tax receipt, Bank statement
Account Details	Passbook, Term Deposit Receipt
Legal Heir (if applicable)	Death certificate of the account holder, Succession certificate, Legal heir certificate, Family tree (varies depending on bank and amount)
Bank Details for Transfer	Cancelled cheque or passbook of the account where funds should be credited
Other	Latest passport-sized photograph(s), Claim form (provided by the bank)

Why Do Accounts Become Unclaimed? Common Reasons

Understanding why bank accounts end up as unclaimed deposits can shed light on the scale of the issue and help us prevent it. Several common reasons contribute to this phenomenon:

• Forgotten Accounts: Perhaps the most common reason is simply forgetting about an account that was opened a long time ago. This can happen when people open multiple accounts for different purposes and then lose track of some, especially if they don't use them frequently.7 This is particularly true for accounts opened in the early stages of one's career or for specific short-term needs.

• Matured Fixed Deposits: Many people invest in fixed deposits (FDs) for a specific period. If the maturity date passes and the depositor doesn't claim the proceeds, especially if there wasn't an automatic renewal instruction in place, the FD can eventually become an unclaimed deposit.1

• Deceased Account Holders: Tragically, a significant portion of unclaimed deposits belongs to deceased individuals. In many cases, their nominees or legal heirs might not be aware of the existence of these accounts or may not come forward to claim the funds due to a lack of information or understanding of the process.6

• Shifting Primary Accounts: People often change their primary bank account for various reasons, such as better services or new job requirements. In such cases, they might forget to close their old accounts, leading to inactivity over time.7

• Lost or Misplaced Documents: Losing important documents like passbooks or term deposit receipts can make the process of claiming the money seem daunting, leading to further inactivity.50

• Lack of Awareness: Some individuals might simply be unaware of the process for claiming unclaimed deposits or even the fact that they might have such funds lying in an old account.55

• Insight: A recurring theme across these reasons is a lack of consistent communication or awareness, both on the part of the account holder and their family.50 This underscores the importance of banks proactively reaching out to customers with inactive accounts and the need for individuals to keep their financial affairs organized and communicate them to their loved ones.

The Numbers Game: Unclaimed Deposit Statistics in India

The sheer volume of unclaimed deposits in India is quite staggering and has been a growing concern. The total amount of money lying unclaimed in Indian banks has shown an upward trend over the years.8 As of March 2024, these unclaimed deposits reached a significant ₹78,213 crore, marking a substantial 26% increase compared to the ₹62,225 crore reported in March 2023.1 This substantial rise highlights the urgency and importance of the efforts being made by the RBI and various banks to address this issue.31 It's also noteworthy that Public Sector Banks tend to hold the majority of these unclaimed deposits.57 Looking back a few years, the total amount of unclaimed deposits with all Scheduled Commercial Banks (SCBs) was ₹24,356 crore as of December 2020.58 Furthermore, the DEA Fund itself held approximately ₹33,114 crore as of March 2020.58 More recently, by the end of 2023, estimates suggest that over ₹1 trillion was stuck in inoperative accounts, with ₹42,270 crore specifically categorized as unclaimed deposits.57 This data clearly indicates that a considerable amount of financial resources remains unclaimed, representing a significant sum that could greatly benefit individuals and families if successfully reclaimed.31

Suggested Data Chart:

Year	Unclaimed Deposits (₹ Crore)
2020	24,356
2023	62,225
2024	78,213

Note: Data compiled from.2 More comprehensive data across all years was not consistently available in the provided snippets.

Good News: Initiatives to Help You Reclaim Your Lost Money

Recognizing the scale of unclaimed deposits, the RBI and other agencies have launched several initiatives to make it easier for people to find and reclaim their lost money:

• RBI's UDGAM Portal: As discussed in detail earlier, the launch of the UDGAM portal is a significant step towards simplifying the search process for unclaimed deposits across multiple banks.1

• '100 Days 100 Pays' Campaign: This targeted initiative aimed to swiftly settle a large number of the top unclaimed deposits within a defined timeframe, demonstrating a focused effort to reduce the overall volume.4

• Simplified Claim Process: Banks are actively working towards implementing new guidelines issued by the RBI, which took effect on April 1, 2025. These guidelines aim to standardize and streamline the process of reclaiming unclaimed funds by introducing common application forms and a uniform set of required documents.1 This move towards standardization is intended to make the process more user-friendly and efficient.

• Online Retrieval Mechanism: The long-term goal is to establish a fully operational online mechanism for retrieving unclaimed deposits, with an anticipated completion by FY26.1 This will further simplify the process, allowing individuals to potentially reclaim their funds without even needing to visit a bank branch.

• Increased Number of Nominees: The recent Banking Laws (Amendment) Bill of 2024 now allows account holders to nominate up to four individuals for each bank account.1 This is a significant increase from the previous limit of just one nominee and is expected to make it much easier for multiple legal heirs to claim funds in the event of the account holder's demise.

• Special Drives: The Finance Minister has also directed financial regulators to conduct special drives focused on settling unclaimed deposits across various financial sectors, including banks, shares, dividends, mutual funds, and insurance.1 These combined efforts from the RBI, the government, and the banking sector as a whole indicate a strong commitment to ensuring that unclaimed money is returned to its rightful owners.4 This proactive stance is likely motivated by the substantial amount of funds involved and the potential positive impact on the financial well-being of the public.

Tips to Avoid the 'Unclaimed' Tag: Stay Active, Stay Informed

The best way to ensure your money doesn't end up as an unclaimed deposit is to be proactive in managing your bank accounts:

• Keep Your Accounts Active: Make sure to conduct regular transactions in your accounts, even if they are small amounts. This signals to the bank that the account is still in use.14

• Update Your Contact Information: It's crucial to inform your bank immediately if your address, phone number, or email address changes. This ensures you receive important communications from the bank.15

• Nominate Beneficiaries: Always assign a nominee to your bank accounts, fixed deposits, and other financial assets. Regularly review and update your nominations if needed.7 This simplifies the process for your loved ones to claim the funds in case of your passing.

• Inform Family Members: Make sure your family members are aware of all your bank accounts and know where to find the relevant information, such as account numbers and bank details.50

• Close Unused Accounts: If you have accounts that you no longer need or use, it's best to close them formally to prevent them from becoming dormant and eventually unclaimed.1

• Regularly Review Your Finances: Make it a habit to periodically review all your bank accounts and investments to ensure you are aware of all your holdings.

By taking these simple steps, you can significantly reduce the risk of your hard-earned money becoming an unclaimed deposit.15

Conclusion: Don't Leave Your Money Behind - Take Action Today!

Unclaimed bank deposits represent a significant amount of money in India, often forgotten due to various reasons. However, it's important to remember that these funds are not lost forever and can be claimed by their rightful owners or legal heirs. The Reserve Bank of India has taken commendable steps to safeguard these deposits through the DEA Fund and has also launched initiatives like the UDGAM portal and the '100 Days 100 Pays' campaign to facilitate their return. With ongoing efforts to simplify the claim process and the potential for a fully online retrieval system in the near future, it's becoming easier than ever to check for and reclaim your forgotten funds. So, if you suspect you or someone you know might have an old, inactive bank account, don't hesitate to take action today. Visit the UDGAM portal or your bank's website, follow the steps outlined, and you might just find some "lost" money waiting to be rediscovered.