New Guidelines for Managing Dormant Accounts and Unclaimed Financial Assets in Nigeria

The Central Bank of Nigeria (CBN) has introduced stricter regulations for managing dormant accounts and unclaimed financial assets in banks and other financial institutions. According to a circular signed by John Onojah, acting director of the Financial Policy and Regulations Department, CBN, the new guidelines are effective immediately and supersede previous policies issued in 2015.

The guidelines align with Section 72 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and were developed following engagement and consultations with relevant stakeholders. They reduce the dormancy period of accounts from six years to 10 years with no customer activity. After 10 years of dormancy, eligible account balances and unclaimed financial assets will be transferred to a special account managed by the CBN.

The guidelines also standardize the management of dormant accounts, unclaimed balances, and financial assets, outlining procedures for the administration of these balances, funds, and assets by banks and other financial institutions in Nigeria. The modalities for transferring relevant balances/funds/assets to the CBN will be communicated subsequently.

The CBN is mandated to open and maintain accounts earmarked to warehouse unclaimed balances in eligible accounts under a trust fund. A management committee will oversee the operation of the Unclaimed Balances Trust Fund, which will manage funds in line with the provisions of BOFIA 2020 and publish procedures for reclaiming warehoused funds and other financial assets.

Eligible accounts 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. Additionally, government-owned accounts, proceeds of uncleared and unpresented financial instruments, unclaimed salaries and wages, commissions, and bonuses are included. The guidelines, however, exempt accounts subject to litigation, judgment debts, accounts under investigation, and encumbered accounts.

The new guidelines aim to streamline the management of dormant accounts and unclaimed financial assets in Nigeria, ensuring transparency and accountability in the financial sector.