The Federal Government has concluded plans to borrow an estimated ₦895 billion from unclaimed dividends and dormant bank account balances, with about ₦100 billion targeted in the initial phase, under the Finance Act 2020. The move, officials say, is designed to raise crisis intervention funds without resorting to new external loans or punitive multilateral conditions.
Under Section 77 of the Finance Act 2020, any unclaimed dividend of a public limited liability company quoted on the Nigerian Stock Exchange and any unutilised amounts in a dormant bank account left untouched for at least six years shall be transferred to the Unclaimed Funds Trust Fund. The Trust Fund is a sub-fund of the Crisis Intervention Fund and will be supervised by the Debt Management Office.
The Act classifies the transferred monies as a “special debt owed by the federal government to shareholders and dormant bank account holders”. Owners can reclaim their funds at any time, and the government insists the arrangement is not a seizure but a borrowing backed by a perpetual trust. Official accounts belonging to the federal, state, or local governments and their MDAs are exempted.
Data from the Nigeria Inter-Bank Settlement System showed 44.5 million dormant bank accounts as of May 2020, with dormant balances estimated at 2.5% of total bank deposits. Government argues that mobilising these idle funds will help plug revenue shortfalls and fund crisis-related expenditures amid mounting debt, which stood at $31.98 billion to multilateral lenders as of September 2020.
A governing council chaired by the Minister of Finance and a private-sector co-chair appointed by the President will oversee the Trust Fund. Other members include the CBN Governor, SEC DG, NDIC MD, representatives of registrars, shareholders’ associations, and the Bankers’ Committee. The DMO will serve as secretariat.
The plan has drawn sharp pushback from civil society. The Socio-Economic Rights and Accountability Project urged President Buhari to drop the borrowing, calling it “illegal expropriation” that would hurt poor and vulnerable Nigerians. SERAP argued the borrowing is “neither proportionate nor necessary” given unchecked corruption and waste in MDAs, and said it violates the right to property under Section 44(1) of the Constitution.
SERAP also flagged the exemption of government accounts as discriminatory, saying it targets ordinary Nigerians while protecting high-ranking officials and politicians. The group demanded that government cut the cost of governance, review jumbo allowances, and improve accountability before tapping private funds.
Finance ministry officials counter that the law provides for claims at any time and removes foreign exchange burdens associated with external borrowing. They add that dividends unclaimed after 12 years would otherwise be redistributed to other shareholders, while the Trust Fund preserves the owner’s right to reclaim.
As debate continues, the DMO is expected to begin transfers once the governing council is inaugurated. For millions of Nigerians with forgotten bank balances or uncollected dividends, the Trust Fund means the money is not lost — but for now, it is being borrowed by the government.
