Unclaimed Deposits With Banks Increases 28% To Rs 42,270 Crore In FY23

In a response to Rajya Sabha, MoS for Finance, Karad, said that the RBI has adopted several steps to lower the number of unclaimed deposits and return such deposits to rightful claimants

Unclaimed deposits with the banks increased 28 per cent in the 2022-23 fiscal year, the Parliament was told on Tuesday. The unclaimed deposits with the banks rose to Rs 42,270 crore on an annual basis, as of March 2023, against Rs 32,934 crore deposits in the preceding 2021-22 fiscal year. 

In FY23, about Rs 36,185 crore of unclaimed deposits were with public sector banks, while deposits worth Rs 6,087 crore remained with private sector banks, as of March 2023, reported PTI. In a written response to Rajya Sabha, Minister of State for Finance, Bhagwat K Karad, said that the Reserve Bank of India (RBI) has adopted several steps to lower the number of unclaimed deposits and return such deposits to rightful claimants. 

Notably, banks send unclaimed deposits lying in the customers’ accounts for 10 or more years to RBI’s Depositor Education and Awareness (DEA) Fund. According to RBI’s direction, banks have been suggested to show the list of unclaimed deposits in accounts that have been inoperative for ten years or longer on their websites and find the locations of their customers, or legal heirs if they have deceased, to return the unclaimed deposits to the rightful claimants. 

Chaudhary informed that the banking regulator urged banks to develop a board-approved policy on the classification of unclaimed deposits, and set up a grievance redressal mechanism to help quick resolution of complaints, record keeping, and periodic review of unclaimed deposit accounts. 

The minister informed that the RBI has also established a centralised web portal, Unclaimed Deposits Gateway to Access Information (UDGAM), to find unclaimed deposits across multiple banks. He added that the regulator has also launched the campaign ‘100 Days 100 Pays’, under which, banks will trace and settle the top 100 unclaimed deposits of every bank in each district within a timeline of 100 days, starting from June 1, 2023, to September 8, 2023. By the end of the campaign, 31 major banks, which account for over 90 per cent of unclaimed deposit balances with the DEA Fund, refunded Rs 1,432.68 crore in the system. 

Replying about the asset quality, Karad cited RBI data and said the gross non-performing assets (NPAs) of scheduled commercial banks stood at Rs 9,33,779 crore on March 31, 2019, Rs 8,96,082 crore on March 31, 2020, and Rs 8,35,051 crore on March 31, 2021. This figure was reduced to Rs 7,42,397 crore on March 31, 2022, and Rs 5,71,544 crore on March 31, 2023. This shows that gross NPAs in scheduled commercial banks (SCBs) have been reducing gradually. Further, Chaudhary noted that the slippage ratios of SCBs dipped from 3.74 per cent in FY20 to 1.78 per cent in FY23.