You need to send some money to your parents for a family emergency. Since your salary is still a week away, you decide to send the money from an old savings account. It is an old salary account that you have not closed, although you changed jobs over a year back. You had left the money untouched for use in case of an emergency. But now, when you try to transfer the money from that account, your bank informs you that it is not possible as the account has become inoperative.
Many of you may have one Savings Account for regular transactions and another as a back-up for emergencies. But sometimes the account that is not used regularly may become inoperative or dormant. In some cases, you may get an alert from your bank - either an SMS or a phone call – asking you to reactivate your account. Let us see how to go about it.
What is an inoperative or dormant bank savings account?
If you do not process any transaction in your bank account for 24 months, the account is classified as inoperative or dormant by the bank. In this case, the transaction refers to a transaction carried out by the customer. It could be a transfer or receipt of money from another account, utility bill payment or a mobile phone recharge. Transactions do not include interest on your savings accounts credited by the bank or dividend credits or service charges/penalties/fees levied on the account..
Why do banks classify accounts as inoperative or dormant?
Accounts are classified as inoperative or dormant to reduce the risk of fraud. Once the account is tagged in above category, the bank is more sensitive to any activity that takes place in the account. Bank staff will conduct due diligence before letting any activity take place in the account.
What are the restrictions on a dormant account?
If your account is classified as dormant, it goes under a lockdown. You cannot make any transactions through the account: Net-banking, phone banking, ATM transactions, cheque withdrawals are all barred.
If you have an Axis Bank Savings Account, the bank will inform you three months in advance that your account is likely to go inoperative or dormant. This is done through letters to your registered address, email to your registered email account and/or an SMS on your registered mobile number. In the case of joint accounts, such alerts are sent to all account holders.
How can I reactivate my dormant account?
The Reserve Bank of India has instructed banks to ensure that the process of reactivation is hassle-free for customers. Below are the simple steps one has to take to reactivate their account:
1. Submit a written application to the bank. If it is a joint account, the application will need signatures of all account holders, irrespective of whether the operating mode is single or joint.
2. Banks will require KYC (Know Your Customer) documents. These will include PAN card, address proof and identity documents.
Banks do not charge fees or penalties to reactivate a dormant account. But it is in your interest to ensure that your account remains operative. All you need to do is to conduct one transaction - offline or online - every year.
Axis Bank offers its customers the option to choose from a wide range of regular and Digital Savings Account with different features and benefits. Savings Accounts are designed to meet the banking needs of people from all walks of life. Axis Bank Savings Account offers unique features such as high transaction limit, free cheque books, etc. The offers and discounts range from discounted movie tickets, Axis EDGE REWARD points to emergency travel allowances and a lot more. Apply for a savings account to enjoy all these features, offers and discounts.
In addition to regular transactions, you can use your savings account to save funds for an emergency. It offers a safe and secure option to save money and you can access the funds as and when you need, without any hassle. There is no lock-in period and no limit to the amount of money you can maintain as balance in your Savings Account.
Disclaimer: This article has been authored by The Source, a Mumbai-based content creation, and curation firm. Axis Bank does not influence the views of the author in any way. Axis Bank and The Source shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
