Having your bank account has its benefits. You get to save your money in one place while earning extra income in the form of savings interest. Other benefits of having a bank account are that people also invest in fixed deposits, open current accounts for businesses, etc. People even go to the extent to open multiple bank accounts to avail of different benefits from different accounts.
But what if your account is frozen or closed as a result of bankruptcy? What happens if you send money to a bank account that has been closed? Is it feasible to get money back in such circumstances? All of these scenarios are extremely risky, and people should be aware of them. Let’s look at how we may deal with these scenarios and get our money back.
Reasons Why Your Money Gets Stuck
- Reasons Why Your Money Gets Stuck
- Step By Step Process to Get Your Money From closed Bank Account
- Final Thoughts
- Frequently Asked Questions
- My employer sent my salary to the closed bank account. Will I lose my money?
- A fishy transaction took place in my account. Should I report it?
- How do I close my bank account?
- My bank shut down suddenly without any notice. I have some money in my account. Will I get my entire money back?
- Is it possible to withdraw the money if the account has not closed yet?
There are numerous reasons why your money gets stuck in the bank. Following is the reasons:
1. Frozen Bank Account
The main reason your money may be blocked is because your bank account has been frozen. When the bank discovers that there are issues with your account, it will usually block it. The bank prevents you from doing certain things by freezing your account. Although you are permitted to deposit funds into your account, you are not permitted to withdraw funds. In other words, your money is locked up at the bank until your account returns to normal.
2. Account is Closed
Your money will get stuck in your bank account if it shuts down due to bankruptcy or if you have shut your bank account and forgotten to withdraw money. If you shut down your account there are chances that you can still withdraw your money up to the permissible limit.
3. Dormant Account
In any case, if your account is inactive or dormant for an extended period of time, the banks will transfer your funds to any available funds. When it comes to addressing inactive accounts, each bank has its own procedure. If you are unsure, check with your bank, or better yet, clarify with the bank before opening an account there.
Step By Step Process to Get Your Money From closed Bank Account
We have already addressed various reasons why your money may be stuck in the bank account. But in case a customer wants to withdraw or claim his deposits, what should they do? The following are the ways you can get your money back:
1. Unfreeze the Bank Account
As previously stated, your account may be frozen by your bank for a variety of reasons, including the suspicion of fraudulent behavior, court orders, unpaid debt, or the use of funds for unlawful work. It will take some time to unfreeze your account if it has been frozen due to legal issues. If your account is frozen for any reason, including suspected fraud, you must contact your bank and give proper identification proof. Your account will be unfrozen and you will be able to withdraw your funds once you have been cleared of any connections to fraudulent activities.
2. Withdrawing Money from a Closed Account
Many people make the mistake of not withdrawing their money from a closed bank account. Before closing the bank account, you must ensure that you transfer your funds to your latest account. But make sure you have a minimum balance required by the bank otherwise they will slap you with bank charges. Sometimes you may end up transferring your money to a closed bank account. In this case, the transaction will not be accepted and hence you should get your money back. If the bank goes bankrupt then the depositors may be insured in some cases.
3. Claiming the Unclaimed Deposits
The bank will transfer your unclaimed deposits if your account has been dormant for a lengthy time. That does not rule out the possibility of getting your money back. You must complete a claim form, a know your customer (KYC) form, and provide deposit receipts or simply your passbook. The unclaimed deposit will be credited to your account and can be withdrawn once the bank receives all of your identity and account confirmation. But, check with your bank to find out how they handle dormant accounts.
Also Check: How to Make Use of an ATM
In brief, you must keep an active bank account, complete all appropriate KYC documents, keep track of your activities, and use your money as needed. Please make sure you return all of your loans and notify your bank of any unusual activity. By following all of the rules, you will be able to take use of all of the financial services that will make your life easier.
Frequently Asked Questions
My employer sent my salary to the closed bank account. Will I lose my money?
Your employer’s transaction will not be cleared in the first place, and the money will be credited to their account. Nonetheless, the likelihood of losing your money is remote.
A fishy transaction took place in my account. Should I report it?
You must notify the bank right away since suspicious behavior can result in your account being frozen.
How do I close my bank account?
You must go to the bank and fill out an account closure form as well as submit relevant documentation. Finally, the bank will charge you fees and demand you to keep a minimum balance in your account.
My bank shut down suddenly without any notice. I have some money in my account. Will I get my entire money back?
Depending on your local banking restrictions, you may be able to receive your money back.
Is it possible to withdraw the money if the account has not closed yet?
Before terminating your account, you are permitted to withdraw funds while keeping a minimum balance.