Saturday, July 20, 2024 -The Central Bank of Nigeria (CBN) has mandated banks and other financial institutions to transfer unclaimed balances and funds from dormant accounts to accounts held by the apex bank.
The CBN has also released regulatory
guidelines for account holders and beneficiaries to reclaim funds that have
been dormant for up to a decade. These regulations were detailed in a document
released on Friday titled "Guidelines on Management of Dormant Accounts,
Unclaimed Balances, and Other Financial Assets in Banks and Other Financial
Institutions in Nigeria."
A dormant account is defined as one that
has been inactive for at least one year. According to the CBN, the revised
guidelines are an update to the ones issued in October 2015, reflecting the
latest conclusions from their review process. These new guidelines supersede
the previous ones and are effective immediately.
The primary aim of these guidelines is
to "identify dormant accounts/unclaimed balances and financial assets with
a view to reuniting them with their beneficial owners." Eligible accounts
include those with balances that have remained dormant for 10 years or more.
To manage these funds, the CBN will
establish an account known as the 'Unclaimed Balances Trust Fund (UBTF) Pool
Account'. A management committee will oversee the operation of this account,
ensuring compliance with the guidelines and managing the funds according to the
provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020. Key
stakeholders involved in this process include the Nigeria Deposit Insurance
Corporation (NDIC) and financial institutions.
For account reactivation, the CBN
requires account owners or beneficiaries to complete a reactivation form in
person. To access the list of unclaimed balances transferred to the CBN,
individuals must provide proof of account ownership, a valid means of identification,
evidence of current residence, and an affidavit confirming the accuracy of the
provided information.
The CBN has stated that it will enforce
compliance through both off-site surveillance and on-site routine and targeted
examinations of banks and financial institutions.
This move aims to streamline the
management of dormant accounts and unclaimed balances, ensuring these funds are
securely held and accessible to their rightful owners.
It read;
“The revised Guidelines, which
operationalizes Section 72 of the Banks and Other Financial Institutions Act
(BOFIA) 2020, followed engagement and consultations with relevant stakeholders,
whose comments and recommendations were considered in the review process.
“It, amongst others, standardises the
management of dormant accounts, unclaimed balances and financial assets, and
outlines the procedure for the administration of these balances, funds, and
assets by banks and other financial institutions in Nigeria.
“The modalities for the transfer of the relevant balances/funds/assets to the
CBN, together with the revised templates for the rendition of quarterly returns
to Banking Supervision Department or Other Financial Institutions Supervision
Department (as the case may be) will be communicated subsequently.
“Hold the funds in trust for
the beneficial owners; Standardize the management of dormant accounts/unclaimed
balances and financial assets. Establish a standard procedure for reclaim of
warehoused.
“Eligible dormant
accounts/unclaimed balances and other financial assets shall include: Current,
Savings and term deposits in local currency.
“Domiciliary accounts;
deposits towards the purchase of shares and mutual investments; Prepaid card
accounts and wallets; Government owned accounts.
“Proceeds of uncleared and unpresented financial instruments
belonging to customers or non-customers of FIs.
“Obtain from the account
owner evidence of ownership of the dormant account with valid means of
identification, evidence of present place of residence, and affidavit on the
accuracy of the information to reactivate the dormant account.
“Verify the information provided on the reactivation form; Not
charge any fee for reactivation of dormant account. Reactivate the dormant
account with the approval of two (2) authorized officers with one being at
least the branch operations manager.
“Reactivate dormant accounts
within a maximum of three (3) working days of receipt of a written application
to that effect. Notify the account owner, free of charge, upon reactivation of
the account. The profit and loss ratio on the unclaimed balances for
non-interest banks shall be determined by the CBN from time to time;
“The FIs shall verify the
claim and initiate the request with supporting documents to CBN within ten (10)
working days;
“Application for reclaim
shall be to the director banking services department, CBN; CBN shall refund
unclaimed balance to the account owners/beneficial owners through their FIs
within ten (10) working days from the date of the receipt of the FI’s request.
“Beneficial owners shall not
make partial claims; and the right of beneficial owners to reclaim shall be
indefinite.”
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