SBI: India’s largest public sector bank, State Bank of India (SBI) has sent recommendations to the Reserve Bank of India (RBI), appealing for changes in the existing rules for declaring bank accounts as inactive.
SBI: India’s largest public sector bank State Bank of India (SBI) has sent recommendations to the Reserve Bank of India (RBI), appealing for changes in the existing rules for declaring bank accounts as inactive. SBI has proposed that instead of only financial transactions, non-financial activities like balance check should also be considered sufficient to keep the accounts active.
SBI’s concern over inactive accounts
SBI Chairman CS Shetty said that accounts opened for government assistance programs often have limited transactions. Such account holders deposit money initially and later withdraw only a few times. For this reason these accounts are declared inactive.
He said that non-financial work like balance check is an indication that the account holder is aware and active about his account. Such accounts should not be deactivated only on the basis of lack of financial activity.
RBI guidelines and SBI’s move
Recently, RBI had instructed banks to resolve the issue of inactive or frozen accounts on priority. SBI has also started a special campaign in this direction. However, the bank has not disclosed the exact number of inactive accounts.
What is a dormant account?
A dormant account is one in which there has been no transaction for a long time. As per the rules, banks declare accounts that have not been used for a long time as inactive. Once the account is deactivated, the account holder cannot deposit or withdraw money in it.
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