Under the current legal framework, the government cannot take the money in citizens' accounts into the state treasury. There is a provision that even the amount deposited in the Banking Development Fund at the National Bank, which has been inactive for more than 20 years, must be paid if the heirs come to claim it.
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The decision to ‘take back the money in bank accounts that have been inactive (without deposits or withdrawals) for 10 years or more’, included in point 78 of the 100-point agenda passed by the first cabinet meeting of the new government, is in the news.
With this decision of the government, some depositors who have kept money in bank accounts but have not added or withdrawn money for many years are confused as to whether the government (in the state treasury) will also take their money.
This article attempts to clarify the decision made by the government, the concerns and interests of the general public, and whether the current law allows the government to take citizens’ money.
According to the existing law, if money is not withdrawn or kept in a bank account (personal) for at least 3 years, it becomes inactive. In the case of institutional bank accounts, there is a provision for it to become inactive within 1 year. Money can be deposited in inactive accounts but cannot be withdrawn. If you fill out a form to withdraw money, it will be reactivated.
However, the provision of keeping the amount of accounts that have been inactive for 20 years and that have not been claimed despite repeated notices from the bank is mentioned in Sections 111 and 112 of the Banking and Financial Institutions Act 2073 (BAFIA). However, this provision was not implemented even till 2078 BS. On 29th December 2078 BS, the National Bank had issued a directive asking the depositors to deposit the amount in the accounts that have not been claimed for 20 years in the Banking Development Fund in the Banking Department of the National Bank. Since then, banks and financial institutions have been sending such amount to the National Bank regularly.
As of last Asad, the National Bank has data that there was only Rs 70 million in the fund. Officials of the National Bank have informed that one or two depositors have been refunded from the amount sent from the bank to the account. Spokesperson of the Nepal Rastra Bank, Guru Prasad Poudel, said that the fund has about 70 million rupees and that the amount is returned through the concerned bank if the claim is made after completing the process. The Banking Development Fund also receives money from various other sources and the amount in inactive bank accounts is not small, said Spokesperson Poudel.
Point 78 of the new government's 100-point agenda mentions collecting details of accounts of banks and financial institutions that have been inactive for 10 years or more and bringing the unclaimed amount to the state treasury after completing the legal process. After the decision was made, there has been increased concern and confusion among citizens as to whether the government will take their money.
'Under revenue reform, the government will collect details of accounts of banks and financial institutions that have been inactive for 10 years or more and bring the unclaimed amount to the state treasury after completing the legal process and bringing it to the state treasury within 90 days,' says point 78 of the agenda.
It is not possible under the current law
What is clear from the aforementioned decision is that under the current law, the government cannot transfer the money in citizens' accounts to the state treasury
However, since the amended bill will be discussed clause-by-clause in the parliamentary parties and the House of Representatives, it is not certain that the provisions decided by the government on the agenda will be passed. Therefore, experts say that there is no need to panic right now.
