JUST IN: NEXT-OF-KIN NOW ELIGIBLE TO CLAIM FUNDS IN DORMANT ACCOUNTS – CBN
Read Time:2 Minute, 15 Second
The Central Bank of Nigeria (CBN) has cleared next-of-kin, legal representatives, or beneficial owners to claim unclaimed balances in dormant accounts.
In a report released over the weekend, CBN clarified this. It stated that next-of-kin can now claim unclaimed funds by submitting applications to financial institutions. These applications must include legal proof of title and, for corporate entities, details of directors and authorized signatories.
The CBN has the authority to manage dormant accounts and unclaimed funds. It can receive and manage these funds in trust for account holders. A dedicated office, supervised by a management committee, will oversee this process.
The CBN will place unclaimed funds in the Unclaimed Balances Trust Fund (UBTF) Pool Account and invest them in Treasury bills and other securities. The principal and any interest will be refunded to beneficiaries within 10 working days of a reclaim request.
According to the apex bank, account owners must visit financial institutions to complete a reclaim form, provide evidence of ownership, a sworn affidavit, and a valid ID. Financial institutions will verify the claim and send it to the CBN within 10 days. The CBN will refund the money within 10 days of receiving the request.
If a financial institution’s license is withdrawn, the Nigeria Deposit Insurance Corporation (NDIC) will manage dormant accounts. Balances in dormant domiciliary accounts are also affected by this policy, but active domiciliary accounts are not.
An inactive account has no customer-initiated transactions for six to 12 months. A dormant account remains inactive for one year or more. Unclaimed balances are those that have been dormant for at least 10 years.
Eligible accounts include current, savings, term deposits, domiciliary accounts, deposits for shares, prepaid card accounts, government-owned accounts, and more. Exempt accounts are those under litigation, investigation, or encumbrance.
The CBN directed banks to notify account owners when an account becomes inactive or dormant and then on a quarterly basis.
Only recently, the CBN directed financial institutions to transfer all unclaimed funds to an account managed by the apex bank.
This was contained in a released revised guidelines for the management of dormant accounts, unclaimed balances, and other financial assets in banks and financial institutions.
This update follows a thorough review and consultation with relevant stakeholders. The new guidelines operationalize Section 72 of the Banks and Other Financial Institutions Act (BOFIA) 2020, replacing the previous guidelines issued in October 2015.
According to the statement signed by the Acting Director, Financial Policy and Regulation Department, John Onojah, the guidelines standardize the management of dormant accounts, unclaimed balances and financial assets and outline the procedure for the administration of these balances, funds, and assets by banks and other financial institutions in Nigeria.
Happy
0 %
Sad
0 %
Excited
0 %
Sleepy
0 %
Angry
0 %
Surprise
0 %
0
0