RBI Eases KYC for Inoperative Accounts via BCs and V-CIP

Circular no. RBI/2025-26/52 DOR.SOG(LEG).REC/32/09.08.024/2025-26, Dated: 12-06-2025

The Reserve Bank of India (RBI) has issued the Inoperative Accounts/Unclaimed Deposits in Banks—Revised Instructions (Amendment), 2025, introducing greater flexibility and convenience in the process of reactivating dormant bank accounts and updating KYC.

1. Objective – Reactivate Inoperative Accounts with Ease

The revised guidelines are part of RBI’s broader initiative to:

• Facilitate the activation of inoperative accounts
• Reduce the volume of unclaimed deposits
• Ensure continued access to banking services for customers, especially in underserved regions

2. KYC Updation Now Simplified and More Accessible

As per the amended norms, banks are now allowed to offer multiple channels for KYC updation, including:

• Any bank branch, regardless of where the account was originally opened
• Video-based Customer Identification Process (V-CIP)
• Assistance from authorised Business Correspondents (BCs)

These provisions make the KYC process faster, more convenient, and accessible even to those in remote areas.

3. Business Correspondents Can Reactivate Accounts

A significant highlight of the amendment is that banks can now:

• Utilise the services of authorised Business Correspondents to assist customers in activating inoperative accounts
• This step empowers field-level banking agents to reach unbanked or rural customers, helping them restore access to their accounts with minimal effort

4. Impact of the Revised Instructions

The revised framework is expected to:

• Accelerate the resolution of inoperative accounts
• Reduce the accumulation of unclaimed deposits
• Enhance financial inclusion by re-engaging dormant account holders
• Improve the efficiency of customer service and compliance processes

5. Conclusion

RBI’s 2025 amendment to the inoperative account and unclaimed deposit framework underscores a continued push for inclusivity, convenience, and digital adoption in banking. By expanding access points for KYC and empowering Business Correspondents, the banking regulator is enabling millions of dormant account holders to seamlessly reintegrate into the formal financial system.

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