The Bank of Ghana (BoG) is set to issue new directives to all commercial banks to enhance the process of identifying and accessing dormant accounts belonging to deceased individuals, including a major change to how Next of Kin (NOK) are involved in account opening procedures.
This comes after the Institute for Liberty and Policy Innovation (ILAPI), uncovered the huge sums of money sitting in a large number of dormant accounts with the Bank of Ghana (BoG).
Thus, the ILAPI has urge BoG to come up with a policy aimed at reducing delays and eliminate identity issues when tracing the rightful beneficiaries of unclaimed funds.
“To avoid prolonged investigations and identity crises, we will now require that the Ghana Card of the Next of Kin be presented during account opening. This measure will help reduce the time taken to identify the rightful heirs of dormant accounts, ensuring smoother and more efficient processes when individuals pass away,” the ILAPI said.
Under the current system, many families of the deceased face challenges in accessing funds from dormant accounts due to lengthy verification processes, which often lead to frustration and financial distress.
The ILAPI emphasized the importance of transparency in managing dormant accounts, calling for more clearly defined policies and a public-facing report.
“We also believe that there should be clearly defined policies around the management of dormant accounts, and we plan to release an annual report on the funds, making it part of BoG’s annual statements. This will ensure transparency, enhancing the public’s confidence and trust in how these funds are managed.”
The new directives also recommend revising the current law that restricts BoG from tracing the families of deceased account holders. At present, BoG is not permitted to take proactive measures to contact families to release dormant account funds, but under the proposed policy change, this would be allowed.
“We are pushing for a review of the law that will allow the Bank of Ghana to trace the families or next of kin of dormant account holders. This will ensure that the funds are properly allocated to the rightful heirs, particularly in cases where they might not be aware of the funds left behind,” the report added.
Another important recommendation from the BoG’s proposed policy is the integration of the national identification system. The BoG intends to collaborate with local government bodies to create a more efficient way of identifying beneficiaries.
“By tapping into the national identification system, we can work with local government bodies to quickly identify the families of the deceased, ensuring they receive the funds owed to them,” Dr. Osei explained.
ILAPI (Institute for Liberty and Policy Innovation), which has been pushing for reforms in the handling of dormant accounts, has supported these recommendations. According to a report from ILAPI, a significant amount of money is tied up in dormant accounts, some of which could potentially improve the lives of those who were financially dependent on the deceased. The organization has long argued for a more proactive and transparent approach in managing unclaimed funds.
“In some cases, these funds could have taken families out of poverty, providing education and economic stability for children and spouses. It is frustrating to know that these funds remain inaccessible due to bureaucratic hurdles,” said the ILAPI.
“The policies being proposed by the BoG are a welcome step toward ensuring that these funds are not locked away indefinitely.”
One of the final suggestions is that BoG impose a time limit on how long unclaimed dormant funds can be held before they are transferred or released.
“There should be a set number of years after which the BoG can retain the funds, after which they must take action, whether that means transferring the funds to the state or making them available for family claims. A clear policy and system for handling these funds should be implemented to avoid prolonged uncertainty.”
As the Bank of Ghana moves forward with these proposals, there is hope that they will create a more efficient, transparent, and supportive system for families who stand to benefit from the funds left behind by their loved ones. The next steps for the BoG include consulting with various stakeholders and initiating the policy framework to be rolled out in the coming month