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Three Types of Bank Accounts That Will Be Closed from January 1, 2026: New Rules Issued by RBI – Fact Check

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A viral message is spreading rapidly on social media and news sites claiming that the Reserve Bank of India (RBI) has issued new rules under which three types of bank accounts will be automatically closed starting January 1, 2026. The three types mentioned are usually:

  1. Inactive accounts (no transactions for 1 year)
  2. Dormant accounts (no transactions for 2+ years)
  3. Long-term zero-balance accounts

Many articles warn that millions of accounts could be affected and balances transferred to a government fund.

The Reality: This is largely exaggerated and misleading. There is no new RBI directive specifically mandating mass closures from January 1, 2026. RBI has long-standing guidelines for handling inoperative/dormant accounts (updated in 2024-2025 for better KYC and fraud prevention), but banks are encouraged to reactivate accounts rather than close them abruptly. Closures happen only after prolonged inactivity (often 10+ years for unclaimed deposits) and with customer notification.

What the RBI Guidelines Actually Say (Latest as of December 2025)

  • Inoperative/Dormant Accounts: An account with no customer-initiated transactions for over 2 years is classified as inoperative. Banks must notify customers and may restrict services (e.g., no withdrawals), but closure is not automatic.
  • Zero-Balance Accounts: Long-inactive zero-balance accounts (e.g., old Jan Dhan accounts) may be reviewed for misuse, but no blanket closure rule for January 2026.
  • Unclaimed Deposits: Balances in accounts inactive for 10 years are transferred to RBI’s Depositor Education and Awareness (DEA) Fund – customers can still claim them.
  • Recent Updates: RBI’s 2024-2025 circulars focus on KYC reactivation, fraud monitoring, and customer reminders – not mass closures.
  • No January 1, 2026 Mandate: Viral stories misinterpret routine guidelines as a “new rule” for immediate closures.

What Should Account Holders Do?

  • Check Activity: Make at least one transaction (deposit/withdrawal/transfer) every 1-2 years to keep accounts active.
  • Update KYC: Ensure Aadhaar, PAN, mobile, and email are linked/updated.
  • Reactivate Dormant Accounts: Visit branch or use net banking with a request – simple process.
  • Zero-Balance Accounts: Add small amounts periodically if unused.
  • Safe Deposits: Even if transferred to DEA Fund, money is reclaimable with proof.

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