Depositor Education & Awareness Fund

Depositor Education & Awareness Fund

The Depositor Education and Awareness Fund Scheme (DEAF Scheme) was established by the Reserve Bank of India (RBI) in 2014 for the promotion of depositors’ interest and for any other related purposes deemed necessary by the RBI.  Accordingly, an amendment was made to Banking Regulation Act, 1949, and Section 26 A was inserted into the Act, authorising RBI to establish this fund


Amount in Non-operative accounts to be transferred to the Fund

A specific account is maintained by RBI for Depositor Education and Awareness Fund (DEAF). RBI has directed the following types of amounts to be transferred to this fund.

  • The credit balance of any deposit account that is maintained with the banks and has not been operated for ten years or more.

Any amount remaining unclaimed for ten years or more which include the following

  • RBI can specify any other accounts beyond those listed above, from time to time. The amount to be transferred also includes the accrued interests which the bank would have paid to the customer.
  • As per a RBI circulardated 02 February 2015, it is mandatory for banks to display on their websites,  the list of unclaimed deposits/inoperative accounts which are inactive or inoperative for more than 10 years. This activity needs to be carried out every  month by the banks and the unclaimed amounts are to be transferred to RBI by the end of each month.
  • Respective banks are required to submit returns of these unclaimed amounts which are deposited in DEAF account.  Form I & IIare used by the banks to submit these returns.


Provision for refund of the amount, if claimed by the depositor

The DEAF scheme provides the option for depositors to reclaim the amount, even after it has been transferred to DEAF.

  • The depositors can check the details of the inoperative accounts/unclaimed amount transferred to DEAF on the website of the respective banks.
  • The claimant is required to visit bank branch and submit the Unclaimed Deposits Claim Formof the respective bank.
  • Required KYC details are to be furnished which serve as proof of the account and the amount being claimed.
  • After verification of the claims, banks can transfer the claim to the customers and then file for a refund from RBI to the extent of the amount claimed by the customers.
  • Any interest payable from the fund on a claim will accrue from the date on which the amount was transferred to the fund to the date of payment to the customer and is limited to those accounts for which the interest was payable by the bank. RBI determines the applicable rate of interest.
  • In case only partial amount is claimed, the account is revived and made operative. The whole amount is transferred back to the now operative account along with the interest if any. The bank can claim refund for the whole amount along with interest.
  • In case of banks  under liquidation, the depositor can submit the claim to the liquidator. If the deposits are covered under DICGC Insurance, DEAF will pay the liquidator the amount which could have been claimed from DICGC. Even for the amounts which are not covered by DICGC, the fund does reimburse the liquidator for any amount being paid to the depositor.
  • For any claims which are settled by the banks during a month, the reimbursement request is to be submitted on the last date of subsequent month.


A Committee constituted to manage DEAF

RBI’s notification about the constitution of the DEAF Scheme, provides for formation of a committee to administer and manage the DEAF.

depositer 2

Any violation in this regard is viewed very seriously by RBI who have recently levied penalty on Dhanlaxmi Bank who flouted the RBI norms.  Here is an article on the same.

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