India’s unclaimed bank deposits have surged dramatically over the last five years, reaching ₹67,004 crore as of June 30, 2025, more than double the ₹27,824 crore reported at the end of FY21. Despite government efforts to facilitate recovery through the ‘Your Money, Your Right’ initiative, only a fraction of these dormant funds have been returned to their rightful owners.
Prime Minister Narendra Modi, on December 10, 2025, highlighted that approximately ₹2,000 crore had been recovered under the campaign since its launch in October. This represents just three per cent of the total unclaimed deposits, underscoring both the scale of idle savings and the challenges in tracking and returning them.
The campaign, launched by Finance Minister Nirmala Sitharaman, aimed to streamline the process of claiming unclaimed bank deposits by individuals, making it easier for account holders to retrieve funds that had remained inactive for years. The three-month drive covered accounts across multiple public and private sector banks, combining awareness outreach with simplified claim procedures.
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Public-sector banks dominate unclaimed deposits
Data shows that public-sector banks consistently account for over four-fifths of unclaimed deposits, with their share rising to 87.06 per cent in FY26. These banks hold the majority of long-dormant accounts, reflecting both their larger customer base and the long-standing retention of inactive accounts.
Experts note that the concentration of unclaimed deposits in public-sector banks also highlights the need for targeted campaigns and digital tracking systems. “While recovery mechanisms have improved, the sheer volume of dormant accounts in large banks makes the process slow and resource-intensive,” said a financial analyst familiar with banking operations.
Factors Behind the Surge
Several factors have contributed to the growth of unclaimed deposits. Changing residential addresses, forgotten account details, or death of account holders often leave deposits dormant. In addition, accounts with minimal activity or very small balances may remain unclaimed for years, gradually accumulating interest yet remaining inaccessible.
Analysts point out that public awareness is another critical challenge. Many account holders remain unaware of government initiatives such as the ‘Your Money, Your Right’ campaign or the processes required to claim funds. As a result, a large proportion of unclaimed deposits remains untouched, despite digital interfaces and bank outreach efforts.
Steps Taken by the Government
To address the issue, the government has encouraged banks to improve communication with customers, including SMS and email alerts, and to facilitate easy online claim processes. Banks have also been directed to flag dormant accounts and proactively inform beneficiaries about recovery options.
Some experts suggest integrating these claims with centralized KYC (Know Your Customer) databases to simplify verification. This could ensure faster processing, reduce fraud risks, and increase the recovery rate over time.
Impact and Implications
The rising volume of unclaimed deposits has broader implications for both consumers and the banking sector. Idle funds represent a significant pool of resources that could otherwise support economic activity if returned to account holders. For banks, managing dormant accounts increases administrative costs and compliance requirements.
Financial analysts emphasize that campaigns like ‘Your Money, Your Right’ not only help citizens reclaim their money but also strengthen trust in the formal banking system. However, the limited recovery so far — only 3% — signals the need for continued awareness, better data management, and proactive bank-customer engagement.
India’s unclaimed bank deposits have more than doubled in five years, reaching ₹67,004 crore, yet the recovery remains minimal at only 3% under the government’s recent campaign. Public-sector banks hold the lion’s share, highlighting both the scale of dormant accounts and the challenge of returning funds efficiently. As government and banks intensify outreach and improve digital solutions, the initiative aims to unlock idle savings, benefit account holders, and strengthen public confidence in the banking system.
About the author – Rehan Khan is a law student and legal journalist with a keen interest in cybercrime, digital fraud, and emerging technology laws. He writes on the intersection of law, cybersecurity, and online safety, focusing on developments that impact individuals and institutions in India.
