Why does account freeze / debit freeze happen?

[sujayghosh]

In my recent thread about IDFC vs IndusInd account I saw quite a few comments mentioning about debit / account freeze in these banks. Now this got me intrigued. In my years of handling accounts across many banks (SBI, PNB, Canara, Axis, ICICI, CUB, Kotak, AU, UCO etc.) for my family, I have never experienced this kind of phenomenon.

So, is this specific to this two banks or some special activities (like sudden inflow) trigger this kind of freeze on any bank?

 

[Mr. BeanMr. Bean is verified member.]

is this specific to this two banks

No. It can happen to any bank. There is no transparency on the red flags. If there is a transparency, then our people will find a way to overcome such transparent regulations or rules. So, the red flags vary across banks.

One common reason is... If you mentioned that you earn less than 1lakh per year and then transact 10 lakh per month, then it is a red flag.

 

[yusuf646]

In my recent thread about IDFC vs IndusInd account I saw quite a few comments mentioning about debit / account freeze in these banks. Now this got me intrigued. In my years of handling accounts across many banks (SBI, PNB, Canara, Axis, ICICI, CUB, Kotak, AU, UCO etc.) for my family, I have never experienced this kind of phenomenon.

So, is this specific to this two banks or some special activities (like sudden inflow) trigger this kind of freeze on any bank?

This can happen with any bank. It typically occurs when the bank's system detects unusual activity, such as transactions that exceed your specified income.

With the rise in popularity of UPI, many people have numerous transactions in their accounts. Banks often freeze accounts if customers receive a large number of payments from different individuals.

Personal savings accounts are not intended for business-related transactions. If you receive a high volume of payments from various sources, the bank may flag your account for unusual activity, as savings accounts are not designed for this purpose.

 

[SSV]

In my recent thread about IDFC vs IndusInd account I saw quite a few comments mentioning about debit / account freeze in these banks. Now this got me intrigued. In my years of handling accounts across many banks (SBI, PNB, Canara, Axis, ICICI, CUB, Kotak, AU, UCO etc.) for my family, I have never experienced this kind of phenomenon.

So, is this specific to this two banks or some special activities (like sudden inflow) trigger this kind of freeze on any bank?

Although technically it may happen to any banks account mainly because of kyc issues and suspicious high risk transactions , it seems these two banks (idfc and indusind) are enforcing this more often than not, to the much displeasure of their customers..

In my observation, the following are the reasons:

IDFC : Frequent UPI transactions..

Indusind:
Mainly because of Vkyc issues in their digital accounts..They generally freeze whose accountals are digital accounts even though vkyc was done .they want you to do full kyc via offline mode..
This in my opinion lack of sophisticated it infrastructure..they had some age old it infrastructure and they are in the middle of migration to mor modern it landscape..

The other general reason for debit freeze among any other bank is: credit from betting/ other suspicious business entities..


And also another observation is: generally you get debit freeze from medium to small sized banks more frequently compared to their bigger counterparts..

All the above comments are general in nature and specifics sometimes may differ to the actual reality....

Enjoy !!!

 

[VasukiVasuki is verified member.]

In my recent thread about IDFC vs IndusInd account I saw quite a few comments mentioning about debit / account freeze in these banks. Now this got me intrigued. In my years of handling accounts across many banks (SBI, PNB, Canara, Axis, ICICI, CUB, Kotak, AU, UCO etc.) for my family, I have never experienced this kind of phenomenon.

So, is this specific to this two banks or some special activities (like sudden inflow) trigger this kind of freeze on any bank?

You are on fire today with new threads use existing threads

 

[sujayghosh]

If you mentioned that you earn less than 1lakh per year and then transact 10 lakh per month, then it is a red flag.

such as transactions that exceed your specified income.

But what if someone has stopped working and so has low income, but has large networth due to investments made previously (from past jobs or inheritance). In such cases, if that person transfers money from his trading or mutual fund account, will that still be flagged? Or, this happens only because of money transfer from some random individual accounts or suspicious companies?

 

[sujayghosh]

You are on fire today with new threads use existing threads

Haha. Actually I searched about similar threads, but couldn't find any general discussion. Hopefully, I am not spamming this forum. 🙏

 

[SSV]

this happens only because of money transfer from some random individual accounts or suspicious companies

The above is correct..
Generally self transfers from other bank account won't cause freeze.
Even then, do it in medium sized transactions rather than huge transactions

 

[yusuf646]

But what if someone has stopped working and so has low income, but has large networth due to investments made previously (from past jobs or inheritance). In such cases, if that person transfers money from his trading or mutual fund account, will that still be flagged? Or, this happens only because of money transfer from some random individual accounts or suspicious companies?

If a large transaction suddenly appears in your account for the first time, there's a significant chance the account will be immediately frozen.

However, this varies from bank to bank. Some banks have lower transaction limits, while others have higher ones. The key factor in these situations is customer support.

If your bank has good customer support, you shouldn't face significant issues. They will typically unfreeze your account within one or two days after you provide the necessary documents, such as a transaction statement or withdrawal receipt in the case of a mutual fund withdrawal.

 

[Fini7777]

The above is correct..
Generally self transfers from other bank account won't cause freeze.
Even then do it in medium sized transactions rather than huge transactions

it's true, but unfortunately in my case it happened
I opened an online acc in IDFC and mentioned my Income as 8-10L
I regularly transferred some amount from my HDFC to this IDFC acc to pay cc bills using this acc
one day for the 1st time I made a cc bill payment of 8k using mobikwik - Debit freeze
called customer care and they removed it
I realized and stopped paying bills using this acc but continued self-transferring money from my other accs
My transaction values were never exceeded 40k and no.of transactions<25 per month
exactly after 1 month My acc was totally frozen

I visited Branch and explained them that those transactions are all mostly self transfers- They did not listen to me and they were even not ready to check my statements

I directly raised this issue to RNO of IDFC- They Immediately responded and unfreeze my account.

then after few days I finally closed this acc bcoz I can't trust this anymore
this is my overall experience with IDFC

This was the first acc freeze happened to me

so, don't make this accs as your primary accs or even secondary, use these accs only for your savings and temp funds
Moreover, it's better to open accounts offline if u can..specifically IDFC, Indusind, ...

 

[SSV]

I opened an online acc in IDFC and mentioned my Income as 8-10L

All your problems had started from here only...

 

[yusuf646]

All your problems had started from here only...

True 💯 💯 💯

 

[SSV]

it's true, but unfortunately in my case it happened
I opened an online acc in IDFC and mentioned my Income as 8-10L
I regularly transferred some amount from my HDFC to this IDFC acc to pay cc bills using this acc
one day for the 1st time I made a cc bill payment of 8k using mobikwik - Debit freeze
called customer care and they removed it
I realized and stopped paying bills using this acc but continued self-transferring money from my other accs
My transaction values were never exceeded 40k and no.of transactions<25 per month
exactly after 1 month My acc was totally frozen

I visited Branch and explained them that those transactions are all mostly self transfers- They did not listen to me and they were even not ready to check my statements

I directly raised this issue to RNO of IDFC- They Immediately responded and unfreeze my account.

then after few days I finally closed this acc bcoz I can't trust this anymore
this is my overall experience with IDFC

This was the first acc freeze happened to me

so, don't make this accs as your primary accs or even secondary, use these accs only for your savings and temp funds
Moreover, it's better to open accounts offline if u can..specifically IDFC, Indusind, ...

All your problems had started from here only...

so, the soultion to this problem is:

Never ever make any online opened accounts your primary..

always use big banks offline accounts as primary accounts ... Period...

 

[Fini7777]

All your problems had started from here only...

yeah! this is the reason I am not suggesting anyone to proceed for online acc opening

 

[sujayghosh]

online opened accounts

Hi, if someone from the bank visit's my home to open the bank account, that will be considered as offline account opening, right?

 

[yusuf646]

Hi, if someone from the bank visit's my home to open the bank account, that will be considered as offline account opening, right?

Yes, most probably. However, the main factor is the account variant. If you open an online account offline, such as opening a Kotak 811 Zero balance account through a branch, it remains an online account.

 

[sujayghosh]

If you open an online account offline

But nowadays, most accounts can be opened online. For example, HDFC savings max account too.

 

[praful47]

I recently opened sbi yono zero balance account.
Is that a matter of concern ?

I don't do any rotation nor any plan to do in future.
I stay out of cashback offers .
Where there is a matter of risking huge amounts

 

[yusuf646]

I recently opened sbi yono zero balance account.
Is that matter of concern ?

I believe you already have a primary account. If you've opened this zero balance account for a few secondary transactions or to avail debit card benefits, then it's fine. Just avoid using this account as your primary one.

 

[yusuf646]

But nowadays, most accounts can be opened online. For example, HDFC savings max account too.

If you open an account online, the bank may impose stricter restrictions to detect any unusual activity, increasing the chances of the account being frozen.

By the way, I believe HDFC rarely freezes any accounts. Correct me if I'm wrong.