Accounts Labeled Dormant After 10 Years

Accounts Labeled Dormant After 10 Years

The Central Bank of Nigeria (CBN) has announced that accounts inactive for over 10 years will be classified as dormant and subsequently used for investment purposes. A new office will be established to manage these dormant accounts and unclaimed balances………. CONTINUE READING

This information was revealed in the CBN’s recent document titled “FAQs – Guidelines on Dormant Accounts and Unclaimed Balances – July 25, 2024,” which is available on its website. The guidelines implement Section 72 of the Banks and Other Financial Institutions Act, 2020, and aim to standardize the management of dormant accounts and unclaimed balances.

The CBN has indicated that funds from these dormant accounts and unclaimed balances may be invested in Nigerian Treasury Bills and other government securities. The bank will manage these funds in trust, with a commitment to refund the principal and any accrued interest to beneficiaries within 10 working days of receiving a reclaim request from the financial institution.

According to the guidelines, dormant accounts are defined as those inactive for more than 10 years. Eligible accounts include current, savings, and term deposits in local currency; domiciliary accounts; deposits for shares and mutual investments; prepaid card accounts and wallets; and government-owned accounts.

Financial institutions are required to notify customers immediately and quarterly when their accounts become inactive or dormant.

The CBN will create and oversee the “Unclaimed Balances Trust Fund Pool Account” to manage these funds. The guidelines also specify that certain accounts, such as those involved in litigation or regulatory investigations, are exempt from being classified as dormant.

CBN Governor Yemi Cardoso explained that this policy aims to protect funds in dormant accounts from potential fraud and ensure their safe management.