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Tuesday, March 25, 2014

RBI finalises The Depositor Education and Awareness Fund Scheme, 2014

Pursuant to the amendment of the Banking Regulation Act, 1949, section 26A has been inserted in that Act, empowering Reserve Bank to establish The Depositor Education and Awareness Fund (the Fund). 

Under the provisions of this section the amount to the credit of any account in India with any bank which has not been operated upon for a period of ten years or any deposit or any amount remaining unclaimed for more than ten years shall be credited to the Fund, within a period of three months from the expiry of the said period of ten years. The Fund shall be utilized for promotion of depositors' interest and for such other purposes which may be necessary for the promotion of depositors' interests as specified by RBI from time to time. The depositor would, however, be entitled to claim from the bank her deposit or any other unclaimed amount or operate her account after the expiry of ten years, even after such amount has been transferred to the Fund. The bank would be liable to pay the amount to the depositor/claimant and claim refund of such amount from the Fund. 

Taking into account the comments received from various stakeholders, the ‘Depositor Education and Awareness Fund Scheme, 2014' has been finalized and forwarded to Government of India for notifying in the Official Gazette. All banks are advised to be in readiness to take necessary action as the Scheme would be effective on the date of Notification in the Official Gazette. The operational guidelines would be advised separately as soon as the Scheme is notified. 

Further banks are also advised to designate a single contact point for any correspondence/ queries in connection with the ‘Depositor Education and Awareness Fund Scheme, 2014'.
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