Dormant bank accounts published by four Nigerian banks exceed 321,000 following a CBN directive on inactive funds

At least four Nigerian banks have published details of more than 321,000 dormant bank accounts following a directive issued by the Central Bank of Nigeria, triggering fresh debate over customer privacy, banking procedures and rising business failures.

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The affected financial institutions include Access Bank Plc, Union Bank of Nigeria Plc, Stanbic IBTC Bank and Fidelity Bank Plc.

The disclosures were made in compliance with the CBN’s July 2024 Guidelines on Management of Dormant Accounts, Unclaimed Balances and Other Financial Assets, which directed banks to publish dormant account details six months before such balances become eligible for transfer into the apex bank’s Unclaimed Balances Trust Fund Pool Account.

Analysis of the published data showed that Access Bank disclosed 243,934 dormant accounts, Stanbic IBTC listed 26,135 dormant accounts, Fidelity Bank published approximately 61,900 dormant accounts, while Union Bank disclosed 212 dormant and unclaimed accounts inactive for at least 10 years.

The combined figure from the four lenders stood at about 321,181 dormant bank accounts.

Findings from the Access Bank records revealed an almost equal split between individual and corporate dormant accounts, suggesting that business inactivity significantly contributed to the growing volume of dormant balances within the banking sector.

The records showed 122,390 individual accounts and 120,718 corporate accounts, representing 50.34 per cent and 49.66 per cent respectively.

Fidelity Bank’s register reflected a different pattern, with corporate accounts accounting for nearly 79 per cent of dormant balances.

The accounts spanned SMEs, oil and gas firms, logistics companies, churches, schools, hospitality businesses, pharmaceutical firms, marine operators and informal trading enterprises.

Several dormant accounts were linked to major commercial districts in Lagos, including Idumota, Oyingbo, Allen Avenue, Awolowo Road and Ladipo, while other concentrations appeared around Port Harcourt oil-service corridors and northern trading hubs.

Union Bank’s smaller list largely comprised cooperatives, churches, alumni groups, women’s associations and community development organisations.

Meanwhile, some major banks adopted alternative approaches to the directive.

United Bank for Africa Plc maintained an unclaimed dividend register instead of publishing dormant accounts, while First Bank of Nigeria Limited and Zenith Bank Plc provided customer search portals for affected accounts.

Guaranty Trust Bank Plc published dormant account management guidelines without attaching a comprehensive list, while Ecobank Nigeria offered account reactivation services without publishing dormant account records.

Economic analysts and finance experts have since raised concerns over the implications of the publication exercise.

Director of the Centre for the Promotion of Private Enterprise, Muda Yusuf, said the directive exposed weaknesses in customer communication by banks.

“I think it’s more about getting the banks to communicate a lot more with their customers because if the CBN is compelling them to publish, it’s a communication issue,” Yusuf said.

He added that worsening economic conditions and rising SME failures contributed heavily to dormant corporate accounts.

“The mortality rate of businesses has grown significantly. When you are running a business, you have an account, and the business collapses because of a whole lot of issues. You just walk away from everything,” he stated.

Yusuf also criticised cumbersome account reactivation procedures, arguing that excessive documentation discouraged customers from reclaiming dormant balances.

Professor of Economics and Public Policy at the University of Uyo, Akpan Ekpo, questioned the need for public disclosure of dormant accounts.

“The Central Bank has examiners who can go to a bank and ask for accounts and know what they have to do without making it public,” Ekpo said.

“For me, it bothers me about privacy. Because if you publish that person A has a dormant account, it doesn’t look good in terms of the environment we are living in.”

Former President of the Lagos Chamber of Commerce and Industry, Gabriel Idahosa, said dormant accounts often arose from bank mergers, abandoned businesses, customer relocation and the deaths of account holders.

He warned that public disclosures could trigger legal disputes and family conflicts over ownership of dormant funds.

“Ordinarily, the central bank should not do that because of the privacy doctrine in the relationship between the customer and the bank,” Idahosa said.

Under the 2024 guidelines, the CBN explained that dormant balances and unclaimed financial assets had become increasingly vulnerable to fraud and abuse.

The apex bank said balances eligible for transfer include current accounts, savings accounts, domiciliary accounts, stale drafts, prepaid wallets, unclaimed salaries and abandoned financial assets inactive for at least 10 years.

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The guidelines also directed banks to regularly notify dormant account holders through emails, text messages and letters while maintaining audit trails and quarterly reporting obligations.