CBN Moves to Claim Monies in Dormant Accounts in GTB, Access, Zenith, First Bank, and Others- See Reasons

The Central Bank of Nigeria (CBN) has recently announced new guidelines aimed at claiming funds from dormant accounts. Dormant accounts refer to accounts that have not been used for at least a year and have not received any deposit or withdrawal activity during that period. The new guidelines were contained in a circular sent by the CBN to commercial banks on Wednesday, April 12, 2023.

Under the new guideline, the CBN shall open a pool account to warehouse all funds left in dormant savings, current, and domiciliary accounts. The bank said it would invest the warehoused funds in Treasury Bills and other interest-yielding ventures and return the profits to the owners of the accounts upon reactivation. The dormant accounts shall be reopened, and the funds, including interest rates, returned to the owners upon request within two days.

The CBN has also directed commercial banks to continue paying interest into dormant accounts and maintain period communications with account owners via emails, text messages, and other necessary mediums. This is to ensure that account owners are informed about the status of their accounts and to prevent fraudulent transactions or abuse.

The CBN also plans to establish a management committee to oversee funds from the accounts and disburse them accordingly. The move to warehouse the funds in a joint account known as “Unclaimed Balances Trust Fund Pool Account” is to prevent fraudsters from targeting dormant and unclaimed accounts.

According to the CBN, the continuous maintenance of dormant accounts results in the accumulation of huge unclaimed balances at the disposal of financial institutions for which the depositors may not be adequately compensated. Furthermore, dormant and unclaimed balances are increasingly susceptible to fraudulent transactions or abuse.

The bank has clarified that a bank account should be deemed dormant if it has done any transactions for one year. A bank account shall be classified as dormant if there has been no customer or depositor-initiated transaction in it for one (1) year after the last customer or depositor-initiated transaction. The bank shall institute controls consistent with its precautionary policies, including surveillance procedures and 58-level authorization. To make such an account active, the customer is to provide satisfactory evidence of account ownership, means of identification, and present place of residence.

Unclaimed funds shall be categorized as proceeds of stale local and foreign currency drafts not yet presented for payment by beneficiaries, funds received from a correspondent bank without sufficient details as to the rightful beneficiary and/or a recall of funds made to the remitting bank to which the Nigerian bank’s account had not been debited, and a judgment debt for which the judgment creditor has not claimed the amount of judgment award.

The CBN is empowered by the provisions of Section 72 (11) of the bank and other financial institutions to carry out the guideline. As of January 2021, about N500 billion had been left by their owners in abandoned bank accounts.