If you SB or current account hasn’t witnessed any transactions(credit/debit except interest credited the bank, deduction of service charges, for more than 1 year, the account is rendered inactive. On exceeding 2 years, the account is declared dormant/inoperative.
Any customer induced transaction is enough for this purpose. Like credit or debit transactions done by the account holder in this account, keeps it active. Some of them have been listed below –
♦ Outward bill
♦ Inward bill
♦ Transactions through cheque.
♦ Deposit of cash
♦ Deposit through cheque
♦ Cash withdrawal or deposit via ATM.
♦ Internet banking transaction
♦ Crediting interest earned mandate on Fixed deposit to Savings Bank Account
When does a bank assume an account as inoperative?
If there is no transaction in the account for one year, the bank tries to contact the account holder or the nominee. In case of no replies, the bank will send intimation to account holder 2 or 3 months prior to treating his inactive account.
On continuation of this ‘inactive’ status for 2 years, the status becomes ‘inoperative’ or ‘dormant’. The process will be completed by sending a correspondence to the account holder, declaring the account as ‘inoperative’.
•No valid transaction for 1 year – inactive bank account.
•No valid transaction for 2 years – inoperative bank account.
How to change the status of a “Dormant Bank Account” to an “Active Bank Account”?
An inoperative account can become an operative account within 24 hours. All you need to do is to submit an application along with identity proof and passbook or cheque book to your bank, stating the reasons for absence of valid transactions.
After completion of “Know Your Customer” formalities, banks usually put the customer’s account on Active mode within 24 hours.
Remember, there is no reactivation charge on a dormant account.
An inoperative account will have restrictions for several transactions including ATM withdrawal, internet or phone banking, issuing new cheque books, etc. All these are intended for the safety of the money in the account. Otherwise, it may increase the risk of fraudulent transactions from your account.
If you are having more than one account, it is always better to keep tabs on them or making some small transactions just to keep them active. In this age of netbanking, all it takes is a few mouse clicks and your account would remain operational.