2 weeks ago
RBI Advises Checking Old Bank Accounts for Inactive Status
When you open a bank account, the bank keeps your money safe for you.
But if you don't use the account for a very long time, it can become inactive.
In India, an account becomes inactive if there are no transactions for more than two years.
Your money doesn't disappear when the account is inactive — it still belongs to you.
However, you can't take money out or use the account until you update your information with the bank.
The bank needs fresh KYC documents like your Aadhaar, PAN, and address proof.
You usually have to do this at a bank branch, though some banks allow video calls.
It's important to check on old accounts you forgot about, because inactive accounts can be misused by fraudsters.
Never share your OTP, PIN, or passwords with anyone, even if someone asks.
Keeping your bank details updated helps keep your money safe.
Under RBI regulations, a bank account becomes inactive if there are no account holder-initiated transactions for more than 2 years.
An inactive account does not mean the money disappears or becomes the bank's assets, but funds cannot be withdrawn or used until the reactivation process is completed.
Reactivating an inactive account requires fresh KYC — Aadhaar, PAN, and address proof — usually in-branch, though video KYC may be available per bank rules.
Atish Jain, CEO of Choice Wealth, said dormant accounts are easy targets for money mule networks and fraud and suggested video-KYC or app-based reactivation to improve financial inclusion.
Account holders should monitor old accounts to keep KYC details, phone numbers, and emails updated and should never share OTPs, ATM PINs, or passwords with third parties.
- Who
- Indian bank account holders with unused accounts; the Reserve Bank of India (RBI) sets the rules; Atish Jain, CEO of Choice Wealth, commented on the issue.
- What
- Bank accounts are classified as inactive after more than 2 years without holder-initiated transactions, and funds cannot be used until KYC is updated to reactivate them.
- Where
- India
- When
- An account becomes inactive after more than 2 years without account holder-initiated transactions; no specific date is given in the article.
- Why
- To ensure financial stability and account security and to prevent dormant accounts from becoming targets for money mule networks and fraud, according to the article.
Current RBI Policy
Proposed Digital Reform
How inactive accounts should be reactivated
Current RBI Policy
RBI mandates reactivation via fresh KYC — Aadhaar, PAN, and address proof — usually in-branch, keeping online channels restricted for inactive accounts.
Proposed Digital Reform
Atish Jain of Choice Wealth argues RBI and banks should allow video-KYC or app-based reactivation instead of mandatory branch visits to reduce friction and boost financial inclusion.
Key facts
- Inactivity threshold
- No account holder-initiated transactions for more than 2 years
- Funds status
- Money remains in the account; it does not disappear or become the bank's assets
- Reactivation requirement
- Fresh KYC: Aadhaar, PAN, and address proof
- KYC update locations
- Any bank branch or video KYC facility, per bank rules
- Online access
- Online channels remain restricted for inactive accounts
- Expert cited
- Atish Jain, CEO of Choice Wealth
- Key risk
- Dormant accounts can become targets for money mule networks and fraud
- Security warning
- Never share OTPs, ATM PINs, internet banking passwords, or card PINs with third parties
Quotes
Atish Jain
CEO of Choice Wealth
“"Dormant bank accounts are a growing blind spot in India's financial system. RBI mandates reactivation via fresh KYC—Aadhaar, PAN, and address proof—usually in-branch, since online channels stay restricted for inactive accounts. Left unmonitored, such accounts also become easy targets for money mule networks and fraud. RBI and banks could ease this friction by allowing video‑KYC or app-based reactivation instead of mandatory branch visits — this would nudge lakhs of dormant holders back into the”
livemint.com
Sources
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