Unclaimed Monies In Dormant Accounts To Be Invested In T-Bills – CBN

Banks are being asked by the Central Bank of Nigeria (CBN) to transfer money from accounts that have lain idle for up to ten years into a Trust Fund account, which will then be used to purchase Treasury Bills.
This is stated in the guidelines on the management of dormant accounts, unclaimed balances, and other financial assets in banks and other financial institutions in Nigeria that were just released as an exposure draft.

In response to demands from banks and other stakeholders for the CBN to clarify the processes for the administration of dormant and inactive accounts by banks in the nation, the guideline was developed, according to a circular that was included with the exposure draft.

The top bank’s Director of Financial Policy and Regulation Department, Chibuzor Efobi, signed the circular, which also requested suggestions be given within three weeks.

According to the draft, banks and other financial institutions (OFIs) must deposit all unclaimed funds from accounts that have lain dormant for up to ten years into a pool account designated for the Unclaimed Balances Trust Fund (UBTF), which will have its domicile at the CBN.

Additionally, they must transfer unclaimed amounts on a quarterly basis, no later than 15 days into the first month of the next quarter, and save any correspondence about the management of dormant accounts for at least 10 years.

The guidelines state that banks and OFIs are required to “maintain records of the beneficiaries of the unclaimed balances warehoused in the UBTF Pool Account; invest the funds in Nigerian treasury bills (NTBs) and other securities as may be approved by the “Unclaimed Balances Management Committee”; and refund the unclaimed funds to the beneficiaries not later than 10 working days from the date of receipt of the request.”
In the exposure draft, it is stated that banks and other financial institutions are obligated to contact account holders whose accounts are dormant and to provide a list of these accounts on their websites.

In addition to these duties, financial institutions must additionally keep an eye on “inactive accounts, warn consumers, and safeguard such accounts against unauthorized activity; Create processes that will guarantee ongoing communication with clients to lower the number of dormant or inactive accounts.

“Maintain records of procedures and periodic efforts to contact customers with inactive accounts; advise customers in writing on the importance of communicating changes to their names, addresses, phone numbers, emails, and next-of-kin.”

Keep a register of all money sent to CBN for reclaiming and an audit trail. Details of all dormant accounts are posted on their websites six months before they become eligible for transfer to CBN. However, other financial institutions (OFIs) without websites must post the same information on the website of their association.

With the exception of unit microfinance banks, which must publish in their locations, publish the list of account holders with dormant accounts in at least two national daily publications. The next-of-kin of the account holder as well as their name, branch address, and other pertinent information must be disclosed. The account has been moved to the registry of dormant accounts, it should also be noted.