RBI’s Big Move: Now Reactivate Dormant Accounts via Video KYC—Here’s Everything You Need to Know
In a significant move to simplify banking for millions of customers, the Reserve Bank of India (RBI) has rolled out new guidelines aimed at reactivating dormant bank accounts and unclaimed deposits. These changes, effective from June 12, 2025, mark a major step toward making the KYC (Know Your Customer) process more convenient and accessible for everyone—especially the elderly, rural residents, and Non-Resident Indians (NRIs).
What Has Changed?
Traditionally, to reactivate an inactive account, customers had to visit the specific branch where their account was originally opened. This often posed a challenge for those who had moved or lived in remote locations. With the latest RBI directive, customers can now update their KYC at any bank branch, through video KYC, or with the assistance of a bank’s Business Correspondent (BC)—no matter where their account was created.
This flexibility is expected to greatly reduce the hassle for account holders, allowing smoother reactivation and access to funds that may have otherwise remained untouched.
Understanding Inactive Accounts and Unclaimed Deposits
An account is classified as inactive or dormant when there has been no activity for a period of 10 years or more. Likewise, deposits that remain unclaimed for a decade are transferred to the Depositor Education and Awareness (DEA) Fund managed by the RBI.
The new policy specifically targets these accounts, encouraging rightful owners to reclaim access and funds with ease.
Key Highlights of RBI's New Guidelines
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KYC can be updated at any bank branch, eliminating the need to visit the original branch where the account was opened.
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Video-based Customer Identification Process (V-CIP) is now permitted for KYC updates. This process enables customers to complete verification from the comfort of their homes via a secure video call.
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Authorized Business Correspondents (BCs) are now empowered to assist in updating KYC and reactivating accounts, particularly beneficial in rural or underserved areas.
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These changes are already in effect from June 12, 2025, making them applicable to all banks and financial institutions regulated by the RBI.
Who Will Benefit the Most?
This move will provide immense relief to senior citizens, NRIs, and people living in remote regions, who often face logistical difficulties in visiting bank branches. With video KYC, they can now complete their verification quickly and securely using a smartphone or computer.
Moreover, Business Correspondents, who act as the extended arms of banks in rural areas, can now facilitate the KYC process for customers in villages or locations lacking physical bank branches.
A Step Towards Financial Inclusion
By modernizing the KYC process and increasing accessibility, the RBI aims to bring more people back into the formal banking system. The new regulations not only empower customers but also encourage banks to adopt digital solutions for customer verification and account management.
With lakhs of dormant accounts lying unused across the country, this reform is expected to unlock a massive pool of idle funds, while also enhancing customer trust in the banking system.
Final Thoughts
RBI’s forward-thinking move to simplify KYC norms and reactivate inactive accounts through multiple channels is a milestone in India's journey toward inclusive and digital banking. Whether it's a senior citizen stuck at home, an NRI abroad, or a rural farmer miles away from a city, this policy ensures that banking services are closer, faster, and more customer-friendly than ever before.
For customers who suspect they may have an inactive account or unclaimed deposit, now is the time to update your KYC and regain access—without the old runaround.
