Indian banking rules to change from August 1: What NRIs in UAE must know
Indian expats should know how new banking rules impact SBI, PNB and unclaimed deposits
Dubai: If you're an Indian expat in the UAE with a bank account, fixed deposit, or unclaimed dividend in India, some key changes to Indian banking rules kick in from August 1, 2025 — and they could impact how your funds are handled back home.
India’s Ministry of Finance just confirmed that new rules under the Banking Laws (Amendment) Act, 2025 will be enforced starting this August. These changes affect the State Bank of India (SBI), other nationalised banks, and co-operative banks, and are designed to modernise how Indian banks manage capital, audits, and unclaimed investor money.
What’s changing from August 1?
Higher minimum capital for banks: Banks in India must now maintain ₹2 crore as minimum capital — up from just ₹5 lakh earlier. This is expected to improve financial strength, especially in smaller co-operative banks used by many in rural areas.
Unclaimed dividends and matured deposits to go to IEPF: If you have unclaimed dividends, matured fixed deposits, or unredeemed shares sitting idle in your Indian bank account for 7 years, the money will now be moved to the Investor Education and Protection Fund (IEPF) — a central government fund. You can still claim your money from the IEPF, but not directly from the bank anymore. This helps prevent misuse or misplacement of long-forgotten funds.
Audit rules now in line with company law: Auditors of SBI and other public sector banks will now be appointed using the same rules as private companies, ensuring better oversight and transparency.
Why this matters to Indian expats in UAE
If you’ve left behind small savings, dividends, or shares in Indian banks that haven’t been touched in years — this update could impact you. Once that money is moved to the IEPF, you'll need to follow a separate claim process to retrieve it.
Likewise, if you're investing in Indian banks, the higher capital requirements and tighter audits may make them safer and more reliable, especially for long-term fixed deposits or NRE/NRO accounts.
Bottom line
From August 1, Indian banks are entering a new phase of reform. These changes aim to strengthen governance, safeguard investor money, and bring state-owned banks in line with global standards. For NRIs in the UAE, it’s a reminder to:
Review any old accounts or unclaimed investments in India
Ensure your Indian bank records are up to date
Claim any inactive funds before they get moved to the IEPF
Want help checking if you have unclaimed dividends or deposits? Indian banks often list them on their websites — worth a quick look before August.
Sign up for the Daily Briefing
Get the latest news and updates straight to your inbox
