These bank accounts will close down from Jan 1. Check if yours is affected

Starting from January 1, banks will be closing three types of accounts. Customers should check if their accounts are affected and take necessary steps to prevent their account from being closed

Starting January 1, 2025, the Reserve Bank of India (RBI) will implement new guidelines, leading to the closure of three specific types of bank accounts. This initiative aims to enhance security, reduce fraud, and improve the overall efficiency of banking operations. Here are the details of the accounts affected:

 

Types of accounts facing closure 

 

Dormant accounts: 

 

Accounts that have had no transactions for a continuous period of two years or more will be classified as dormant. These accounts are particularly vulnerable to hacking and fraudulent activities. The RBI's decision to close these accounts is intended to protect customers and the integrity of the banking system.

 

 

Inactive accounts: 

 

Inactive accounts refer to those that have had no transaction activity for the past 12 months or more. If an account holder has not conducted any transactions within this period, they are required to contact their bank branch and follow the necessary steps to reactivate their account. This measure is being implemented to reduce unnecessary burdens on banks, enhance operational efficiency, and minimise the risk of online fraud.

 

Zero balance accounts:

 

Accounts that maintain a zero balance for a prolonged period may be closed. The RBI's aim is to prevent the misuse of such accounts, reduce financial risks, and promote active engagement between customers and their banks. This initiative also aims to reinforce Know Your Customer (KYC) regulations and ensure that customer information remains current and accurate.

 

Expert recommendations for account holders

 

To prevent account closure, it is advisable for account holders to:

 

Reactivate inactive accounts: Make at least one transaction if your account has been inactive for over 12 months.

 

Engage with dormant accounts: If your account has been dormant for two years, visit your bank branch to reactivate it.

 

Maintain a positive balance: Ensure that your account does not remain at zero balance for an extended period.