RBI Sets Target for Lenders on CBDC, Unclaimed Deposits

The Reserve Bank of India (RBI) has implemented a system of assigning business targets to banks, in line with the guidance from the finance ministry. This is aimed at promoting initiatives such as the central bank digital currency and the recovery of unclaimed deposits.

Bankers stated that the regulator maintains ongoing surveillance of lenders’ activities to ensure compliance with established targets. For example, the RBI has set a goal to achieve one million daily digital currency transactions by December. This will provide the RBI with sufficient data to analyze the effects of Central Bank Digital Currency (CBDC) on the financial system. However, bankers have expressed their opinion that the advantages of the central bank digital currency are restricted, taking into account the widespread use of the Unified Payments Interface (UPI) platform.

As of 30 June, over one million individuals, along with 262,000 businesses, had completed the registration process for participation in the pilot programme for retail Central Bank Digital Currency (CBDC) transactions.

The regulatory authority is actively monitoring the advancements made in the “100 Days 100 Pays” initiative, which requires banks to locate and resolve the top 100 unclaimed deposits from each bank in every district. The scheme was initiated in June and is anticipated to conclude on 8 September.

According to the official, it is a requirement for executive directors of banks to provide the RBI with an update regarding the progress made on unclaimed deposits.

Banks classify the funds held in savings or current accounts that have not been operated for a period of 10 years, as well as term deposits that have not been claimed within 10 years from their maturity date, as unclaimed deposits. These amounts are transferred to the depositor education and awareness (DEA) fund, which is maintained by the

Private and public sector banks have transferred unclaimed deposits totalling ₹1.44 trillion to the DEA fund. Private sector banks have transferred a total of ₹21,315 crore between the dates of March 31, 2019, and March 31, 2023. On the other hand, public sector banks (PSBs) have transferred a larger amount of ₹1.22 trillion during the same period.

Banks have received a total of ₹5,729 crores from the DEA fund over the past five years as reimbursement for resolving unclaimed The  RBI is actively monitoring unclaimed deposits to ensure compliance with legal regulations, as the funds may be transferred to the appropriate authorities, such as the Drug Enforcement Administration (DEA).