Udaipur, December 31, 2024 - The Reserve Bank of India (RBI) has issued a directive for closure of three types of bank accounts starting January 1, 2025. These three types are inactive accounts, dormant accounts and zero balance accounts. This decision was taken by the RBI in order to improve transparency, efficiency of banking operations as also minimise banking fraud. Customers should check the status of their accounts to avoid confusion and transaction issues in the future.

What are these account types:

Inactive Account is one which has not been operated by the account holder for a specified period, which is usually the last 12 months. Fraudsters and hackers usually target such accounts.

Dormant Account is one which has seen no transaction in the past two years. Such accounts, the RBI says, are prone to hacks and cyber frauds.

Zero Balance Account type is one which has maintained only zero amount for a very long time.

Customers with the above bank account types have been advised by the RBI to visit their bank and sort out the status of their accounts. If need be, complete or update the Know Your Customer (KYC) requirements, if not done already.

The aim behind this move by RBI is to encourage banking customers to maintain active relationships with their banks so that their financial risks are minimal.