Amid growing concerns over transparency and access, the Supreme Court of India has sought responses from the Union government and market regulator Securities and Exchange Board of India (SEBI) on how legal heirs are informed about unclaimed deposits and financial assets left behind by deceased individuals in banks, mutual funds and security depositaries.
A bench of justice Vikram Nath, justice Sandeep Mehta and justice Vijay Bishnoi, observed that while banks do reach out to families in some cases, the system remains inconsistent. “We know in some cases, banks contact the legal heirs in case of the death of the account holder. The only solution is to have your know-your-customer (KYC) details updated with the bank,” the Court remarked.
The matter arises from a public interest litigation (PIL) filed by senior journalist and Moneylife's managing editor Sucheta Dalal, who flagged that families are often unaware of investments and deposits held by deceased relatives across multiple financial institutions.
The case has drawn attention to the scale of unclaimed financial assets in India, estimated at over ₹1.08 lakh crore across bank deposits, insurance policies, mutual funds, shares and unpaid dividends.
During the hearing, senior counsel Prashant Bhushan, appearing for Ms Dalal, contended that the issue is 'relatively non-controversial', underscoring that multiple government-managed funds currently hold such unclaimed amounts.
These include the depositor education and awareness fund (DEAF) managed by Reserve Bank of India (RBI), the investor education and protection fund (IEPF) under the Union ministry of corporate affairs (MCA) and the senior citizens welfare fund (SCWF). Together, these funds account for more than ₹1 lakh crore, a portion of which relates to untraced beneficiaries of government schemes.
Mr Bhushan also informed the Court of the progress in the matter subsequent to the filing of the petition. He showed the Court the developments that have taken place and what is needed further.
Counsels for RBI and IPEF sought a week's time to place on record the subsequent developments regarding their funds.
The Court granted them a week's time and has listed the matter once again on 19 May 2026.
Senior counsel Ranjeet Kumar, appearing for RBI, reiterated the central bank's affidavit and highlighted the progress of the UDGAM (unclaimed deposits – gateway to access information) portal, launched in 2023.
Mr Kumar informed the bench that several improvements have been made to the portal, including optional user registration, expanded search parameters, including address-based queries, removal of search limits, and longer session durations.
Government data presented during the hearing showed that while significant sums have been transferred into unclaimed funds, recovery by rightful claimants remains limited.
Public sector banks (PSBs) alone had transferred over ₹58,000 crore to the DEAF as of March 2025, while total recoveries across banks stood at ₹10,297 crore between April 2022 and November 2025.
The issue has also been acknowledged at the highest level, with prime minister (PM) Narendra Modi noting in December 2025 that over ₹1 lakh crore remains unclaimed across financial instruments, and emphasising efforts to return the money to rightful owners.
The Supreme Court has listed the matter for further hearing, with fresh affidavits expected to clarify the government’s roadmap for a unified database and measures to ensure that legal heirs are not left in the dark about financial assets belonging to deceased family members.
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