What Are Unclaimed Bank Deposits?

Unclaimed deposits are balances lying in savings accounts, fixed deposits, recurring deposits, or other bank accounts that have had no customer activity for 10 years or more. After this period, banks are required to transfer these amounts to the Depositor Education and Awareness Fund (DEAF), maintained by the Reserve Bank of India (RBI).

Importantly, these deposits are not forfeited. Depositors or their legal heirs can still claim the money at any time through the bank, which then seeks reimbursement from RBI.

Conditions for Classifying Deposits as “Unclaimed”

As per RBI rules, an account becomes unclaimed if:

1. No activity for 10 years – No withdrawals, deposits, cheque issuance, fund transfers, or ATM use by the customer. (Note: Interest credited by the bank does not count as activity.)
2. Matured Fixed Deposits not withdrawn – If maturity proceeds remain unclaimed for 10 years after the due date.
3. Recurring / Term Deposits – Similar rule applies if the maturity amount is not claimed for 10 years.
4. No customer contact – If the bank receives no communication from the customer for 10 years.
5. Joint Accounts – If one holder dies and the survivor doesn’t operate the account, it may become unclaimed after 10 years.

The amount of Unclaimed Deposits

As of 2025, unclaimed deposits stood at around ₹67,270 crore (Moneycontrol). In June 2025, the figure was ₹67,003 crore, with the State Bank of India (SBI) alone holding 29% of these funds (The Indian Express).

In March 2024, RBI data showed unclaimed balances at ₹78,213 crore, highlighting the rapid increase. Depending on the cut-off dates and definitions, the total is currently estimated at ₹60,000 to ₹80,000+ crore.

Why Do Deposits Become Unclaimed?

Several factors contribute to deposits going unclaimed:

1. Death of Account Holder – If the account holder passes away without a nominee, or heirs are unaware of the account.
2. No Nominee / KYC Issues – Missing or incomplete nomination and documentation delays claims.
3. Forgotten Accounts – Dormant salary or savings accounts left idle after job changes, relocation, or migration abroad.
4. Senior Citizens’ Deposits – Long-tenure fixed deposits that are forgotten after maturity.
5. Mergers & Branch Closures – Bank mergers or branch closures lead to tracking issues.
6. Litigation & Family Disputes – Accounts stuck in inheritance disputes.
7. Lack of Awareness / Access – Low financial literacy and poor communication prevent claims, especially in rural areas.
8. Corporate Accounts – Defunct companies often leave balances in old current accounts.

What Does RBI Do With DEAF?

The Depositor Education and Awareness Fund (DEAF), created in 2014 under Section 26A of the Banking Regulation Act, holds all such balances. As of 2025, DEAF contains over ₹60,000 crore.

RBI uses the fund as follows:

1. Depositor Education – Running awareness campaigns on safe banking, fraud prevention, nomination, and financial literacy.
2. Claims Settlement – When a depositor or heir approaches the bank with valid proof, the bank refunds the money and gets reimbursed from DEAF.
3. Research & Awareness Promotion – Supporting research, training, and awareness on depositor protection.
4. Investment of Funds – RBI invests the fund safely. The interest earned is used for education and awareness activities, while the principal remains intact to honor future claims.

The rise in unclaimed deposits points to gaps in financial awareness, nomination practices, and inheritance planning. Regularly updating nominees, keeping track of fixed deposits, and ensuring family members know about accounts can prevent money from lying idle in DEAF.