The Central Bank of Nigeria (CBN), has revealed its plan to invest in treasury bills and other securities with funds trapped in dormant bank accounts. This is as the apex bank issued new guidelines to financial institutions in the country on the operations of dormant accounts which have received no deposit or withdrawal for upwards of one year.
In the guidelines, CBN promised to open a pool account to warehouse all funds left in dormant savings and current and domiciliary accounts.
“The continuous maintenance of such accounts results in the accumulation of huge unclaimed balances at the disposal of the financial institutions for which the depositors may not be adequately compensated. In addition, dormant and unclaimed balances are increasingly susceptible to fraudulent transactions or abuse,” CBN’s circular read.
CBN said it would establish a management committee to oversee funds from the accounts and disburse them accordingly. It also stated that a bank account should be deemed dormant if it has not done any transactions for one year.
It said: “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 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.”
Dormant bank accounts in Nigeria
Data by Nigeria Inter-Bank Settlement System Plc (NIBSS) revealed that as of December 2021, there were 191.4 million bank accounts in Nigeria, out of which 133.5 million were active. With this, BizWatch Nigeria understands that there are 57.9 million inactive bank accounts both savings and current in Nigeria.
