All Inactive Accounts to be Closed on 1 June 2024: PNB

Punjab National Bank (PNB) has announced that it will close all its customers' inactive bank accounts on 1 June 2024. Customers whose accounts have become inactive can activate their accounts by completing their KYC (Know Your Customer) by 31 May 2024.

The bank has taken this step to reduce expenses and prevent fraud in such accounts.

Which Inactive accounts will be closed and which will not 

Accroding to the PNB, those customers' accounts will be closed where there has been no transaction(deposit or withdrawal) by the customer for the past three years, and the account balance has been zero. The bank said that if these account holders do not complete their KYC by 31 May 2024, then they will not be given further notice, and their account will be closed permanently on 1 June 2024.

Accounts not be closed. 

However, the bank said that it will not close certain inactive accounts. The exempted accounts are student accounts for customers under the age of 25, Minor accounts, accounts opened for specific schemes like Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) Sukanya Samriddhi Yojana (SSY), Atal Pension Yojana, and Direct Benefit Transfer (DBT), and those frozen by statutory authorities like court orders, income tax department orders, etc.

The bank will also not close bank accounts linked with Demat accounts, lockers, or active standing instructions accounts.

Difference between inactive accounts and Unclaimed deposits 

According to the Reserve Bank of India(RBI), bank accounts (savings or current accounts) become inactive when there has been no customer-induced transaction transaction for the last two years. These accounts are also called dormant accounts.

Customer-induced transaction means a transaction which is in the nature of ;

• Financial transactions initiated by the customer or done on behalf of the account holder by the bank or third party,
•  Non-financial transactions like checking or account balance etc through an ATM, 
• KYC updation is done by the customer through face-to-face mode or digital channels.. 

According to RBI, Unclaimed deposits in banks means the deposit with the bank where  no transaction(withdrawal or deposit) has been done by the customer  for the last 10 years. Here the customer accounts includes all types of bank accounts like current account, saving account, fixed deposits ,recurring deposits , cash credit accounts etc.

Features of an Inoperative Account 

According to the RBI, 

• banks will have to pay interest on inoperative savings accounts on a regular basis.
• The banks cannot levy penalty charges for non-maintenance of minimum balances in an inoperative account.
• Banks will levy no charges for activation of the inoperative bank accounts.

How to activate the inactive account 

According to the RBI, an inactive customer account can be activated by performing a fresh KYC of the customer. Under the KYC the customer has to submit his/her fresh photograph. One approved Identity proof and one address proof. These could be Voters ID cards, Aadhaar cards, passports, etc.

Punjab National Bank (PNB)

Punjab National Bank is the third largest public sector bank after the State Bank of India and Bank of Baroda.

The Punjab National Bank was established as a private bank in 1894 and commenced operation in 1895.

It is the first bank to set up with Indian capital.

 Lala Lajpat Rai was the first person to open an account in the bank.

It was nationalised in 1969, and presently, the government of India has a majority stake.

Managing Director (MD) and Chief Executive Officer (CEO): Atul Kumar Goel

Headquarters: New Delhi 

Tagline of the Bank: A name you can bank upon.