India’s banking system is entering a new phase from February 1, 2026. The Reserve Bank of India has instructed banks to begin closing inactive, dormant, and unused zero-balance accounts across the country. This decision is part of a large-scale effort to clean up the banking system and reduce risks linked to unused accounts. Millions of customers may be affected, especially those who opened accounts years ago and then stopped using them.
Why So Many Bank Accounts Became Inactive
Over the past decade, banking access in India expanded rapidly. Government programs, digital onboarding, and simplified KYC rules encouraged people to open bank accounts easily. Many of these accounts were created for specific purposes such as receiving salaries, subsidies, or one-time benefits. Once those needs ended, the accounts were often forgotten. As a result, banks today manage a huge number of accounts that no longer serve any real function.
Why the RBI Is Closing Inactive Accounts Now
Inactive and dormant accounts pose serious security concerns. Such accounts are often targeted by fraudsters and cybercriminals because they are rarely monitored by customers. These accounts can be misused for illegal transactions without the account holder’s knowledge. By ordering banks to close long-unused accounts, the RBI aims to improve safety, reduce fraud, and lower unnecessary operational costs for banks.
Understanding Inactive and Dormant Accounts
An inactive account is one where no customer-initiated transaction has taken place for twelve consecutive months. This includes the absence of deposits, withdrawals, or transfers. Automated credits such as interest do not count as activity. If the inactivity continues for twenty-four months, the account becomes dormant. At this stage, banks are required to try contacting the customer before moving toward closure.
Which Accounts Are Most Likely to Be Closed
Savings and current accounts with long periods of inactivity are high on the list. Dormant accounts that have remained untouched for over two years face a strong risk of closure. Zero-balance accounts with no inflows, no withdrawals, and no connection to government benefit schemes are also under scrutiny. Accounts linked to pensions, subsidies, or direct benefit transfers are generally safer because they receive regular credits.
What Customers Should Do Before February 2026
Customers who want to keep their accounts active should take simple steps such as making a small deposit or withdrawal and ensuring their contact details are up to date. Checking account status regularly and confirming whether an account is linked to any government benefits can also help prevent unexpected closure.
Conclusion
The RBI’s move is meant to strengthen India’s banking system, improve security, and ensure resources are focused on active users. With February 1, 2026 approaching, account holders should review their banking activity and act early to avoid inconvenience.
Disclaimer
This article is for general informational purposes only. Banking rules, timelines, and implementation may vary by bank and individual account status. Readers are advised to contact their respective banks or refer to official RBI and bank notifications for the most accurate and up-to-date information.
