Universities eligible for assistance under RBI's education fund

The Reserve Bank of India (RBI) has proposed that universities and educational institutions will be among those entities eligible for financial assistance under its Depositor Education and Awareness Fund (DEAF) Scheme 2014.

The RBI had earlier said that unclaimed deposits with banks estimated to be excess of Rs 3,600 crore will be transferred to the DEAF. The scheme provided for banks to reclaim from the fund if any investor approached the bank after 10 years.

The fund was to be managed by an RBI panel headed by a deputy governor and resources allocated to entities promoting financial literacy among depositors. The central bank has now sought comments on a paper which lists out those eligible to receive assistance.

In its draft of the criteria for registering institutions for grant of financial assistance, RBI said that it will consider institutions/organizations already engaged in activities relating to depositor education or proposing to take up depositors' education programmes, organising seminars and research activities.

RBI said that it will also consider an institution wholly or partly financed by the government or a local authority; or a regimental fund or non-public fund established by the armed forces of the Union for the welfare of past or present members of such forces or their dependants.

Unless RBI decides to give it special exemption, to be eligible an institution needs to have been in existence for five years prior to application for registration and its members should have a clean track record. Among other criteria, the institution should not be for the benefit of any particular individual, religion, community, or caste.