As of now, in all banks, if a Term Deposit matures and proceeds are unpaid, the amount left unclaimed with the bank (overdue deposit amount) shall attract rate of interest as applicable to savings deposits.
Now, RBI amended these instructions as “if a Term Deposit (TD) matures and proceeds are unpaid, the amount left unclaimed (overdue deposit amount) with the bank shall attract rate of interest as applicable to savings account or the contracted rate of interest on the matured TD, whichever is lower” .
Amendments to Master Directions
| Sl. No. | Existing Section | Amended Section |
| A. Master Direction – Reserve Bank of India (Interest Rate on Deposits) Directions, 2016 dated March 03, 2016 (Updated as on February 22, 2019) Section 9 (b) | Interest on overdue domestic deposits If a Term Deposit matures and proceeds are unpaid, the amount left unclaimed with the bank shall attract rate of interest as applicable to savings deposits. | Interest on overdue domestic deposits If a Term Deposit (TD) matures and proceeds are unpaid, the amount left unclaimed with the bank shall attract rate of interest as applicable to savings account or the contracted rate of interest on the matured TD, whichever is lower. |
| B. Master Direction – Reserve Bank of India (Co-operative Banks – Interest Rate on Deposits) Directions, 2016 dated May 12, 2016 Section 9 (b) | Interest on overdue domestic deposits If a term deposit matures and proceeds are unpaid, the amount left unclaimed with the co-operative bank shall attract rate of interest as applicable to savings deposits | Interest on overdue domestic deposits If a Term Deposit (TD) matures and proceeds are unpaid, the amount left unclaimed with the co-operative bank shall attract rate of interest as applicable to savings account or the contracted rate of interest on the matured TD, whichever is lower. |
Input: rbi.org