The CBN has issued new regulations for dormant accounts and unclaimed balances in Nigerian banks. Discover the details and implications.
Financial institutions are now required to transfer accounts that have been inactive for more than ten years to the custody of CBN according to newly released directives on Friday.
The objective of the CBN’s instructions is to establish a uniform approach for managing idle accounts, neglected balances, and monetary possessions. These regulations encompass the processes that banks and financial facilities need to implement when handling such funds or assets.
Later, the bank will release information on how to transfer pertinent balances, funds and assets to the CBN. Additionally, it shall distribute new templates for submitting quarterly returns deemed fit by either Banking Supervision Department or Other Financial Institutions Supervision Department with updated changes.
As of now, these guidelines supersede a preceding circular dated October 2015.
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Financial institutions often have dormant deposit accounts and other liabilities that go unused for prolonged periods, prompting the CBN to observe. Holding onto such accounts can result in considerable unclaimed balances that do not serve any benefit to account holders.
In addition, the CBN cautioned that inactive and unredeemed funds are becoming more susceptible to fraudulent activities and abuse.
The updated rule is designed to thwart the improper use of unused and unutilized accounts while establishing operational benchmarks, as well as expanding the CBN’s supervisory role over these accounts. Additionally, it aims at locating inactive bank accounts with outstanding balances and reuniting them with their lawful owners by holding funds in trust for reclaiming via a uniform procedure.
Accounts that have been inactive for a period of 10 years or longer are considered eligible.
