A very common query is: Can a bank account be closed due to inactivity? In India, a bank account can be classified as “inactive” or “inoperative/dormant” if there have been no customer‑initiated transactions financial or non‑financial for a specified period. As per RBI guidelines, a savings or current account becomes inactive after 12 months and classified as inoperative (“dormant”) after 24 months of no customer activity.
Can a Bank Close Your Account Due to Inactivity?
Yes, a bank account can be closed eventually due to inactivity, but only if it remains dormant for many years. Before that, operations are restricted. However, closure generally requires customer initiation.
Banks are required to notify you (via SMS, email, or letter) when your account is nearing inactivity and before it turns inoperative. Once an account is dormant, its debit operations are disabled, including withdrawals, transfers, ATM/debit card use, cheque clearing, and non-financial services like passbook updates.
However, credit transactions like interest credits or deposits still occur; and importantly, banks cannot charge penalties for minimum-balance non-maintenance or activation of dormant accounts.
Your balance remains safe and continues to earn interest. After 10 years of dormancy, unclaimed funds may be transferred to the RBI’s Depositor Education & Awareness (DEA) Fund, but you can claim them anytime by contacting the bank and completing reactivation steps.
To reactivate a dormant account, customers must submit KYC documents (like Aadhaar, PAN) and a written request often possible via any branch or even through digital channels like video-KYC at no charge. Once reactivated, normal transactions resume.
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Can A Bank Account Be Closed Due To Inactivity?
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2025-06-17T15:13:38+00:00 2025-06-17T15:13:40+00:00Comment
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