Banks are intensifying steps to identify and close bank accounts that have remained inactive for long periods, officials said in Coimbatore. Authorities noted that a large number of dormant accounts can affect transparency in the financial system.
Cyber Crime officials warned that inactive accounts can be misused for illegal activities such as money laundering, hawala transactions and online fraud. They said the growing number of bank accounts among students has also been exploited in such cases.
A Cyber Crime officer said awareness has become essential to prevent “mule account” frauds, and that statewide awareness camps are planned from June, after the exam and holiday season.
Ravi, a financial advisor with the Coimbatore district lead bank, said frauds are being reported using unused accounts, especially those linked to women’s self-help groups and college students. He cautioned that some people unknowingly allow others to use their accounts for a small commission, later getting entangled in fraud cases.
He advised people with multiple accounts to close those that are not being used. Typically, accounts inactive for over two years are automatically frozen, and banks have been guided by the Reserve Bank to close accounts unused for more than a year. Reactivating a frozen account requires submitting KYC documents, while fully closed accounts cannot be reopened, he added.
