The Reserve Bank of India (RBI) on Monday said a bank account will not become inoperative if a dividend cheque has been credited in it in the previous two years.

"Since dividend on shares is credited to Savings Bank accounts as per the mandate of the customer, the same should be treated as a customer induced transaction," the Reserve Bank said in a notification.

"As such, the account should be treated as operative account as long as the dividend is credited to the Savings Bank account."

A bank account become inoperative or dormant if no credit or debit transaction has been conducted for a period of two years.

This clarification has been issued in view of the doubts raised by some bankers whether an account in which only dividend has been credited can be treated as inoperative after two years. (PTI - NDTV)