Federal Government Utilizes Unclaimed Funds for Borrowing
The federal government has recorded a significant borrowing of N100 billion from unclaimed dividends and dormant bank accounts, according to new data from the Debt Management Office (DMO). This information reveals that funds stored under the Unclaimed Funds Trust Fund have been converted into government securities.
As of December 31, 2025, the “UFTF FGN Security” stood at N100 billion, which constitutes approximately 0.12 per cent of the Bola Tinubu-led government’s total domestic debt. The UFTF, established under the Finance Act 2020, serves as a repository for idle financial assets. According to the National Debt Management Framework 2023–2027, unclaimed dividends from quoted companies and balances in dormant bank accounts that have remained inactive for at least six years are transferred into this fund.
The Debt Management Office collaborates with the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC) to manage the fund. Any investment of the fund in Federal Government securities is recognized as part of public debt. This implies that the N100 billion recorded under “UFTF FGN Security” represents funds sourced from unclaimed private assets but deployed by the government as part of its borrowing program.
The Finance Act 2020 provided the legal basis for this arrangement, explicitly allowing the government to utilize these funds. It stated that such unclaimed dividends transferred to the Unclaimed Funds Trust Fund shall be a special debt owed by the Federal Government to the shareholders and shall be available for claim by the shareholder at any time, pursuant to the perpetual trust.
This development occurs amid a steady rise in Nigeria’s debt profile, driven largely by persistent fiscal deficits and increasing reliance on domestic borrowing. Data from the same DMO report showed that total Federal Government domestic debt stood at about N80.49tn as of December 2025, with FGN bonds accounting for the bulk at over 79 per cent, followed by Treasury bills at about 17 per cent.
Despite its relatively small size, the use of unclaimed funds has continued to attract criticism from stakeholders, particularly since the policy was introduced. The Socio-Economic Rights and Accountability Project (SERAP) previously asked the government to drop its plan of borrowing about N895bn from unclaimed dividends and funds in dormant accounts.
In July 2024, The Punch reported that the Central Bank of Nigeria directed all banks and other financial institutions to transfer all dormant accounts, unclaimed balances, and other financial assets to its dedicated account. The apex bank made this known in a circular released on Friday and signed by John Onojah, acting director of the Financial Policy and Banking Regulation Department.
According to the CBN, all dormant accounts and unclaimed balances with banks for at least 10 years will be warehoused in a dedicated account known as the Unclaimed Balances Trust Fund Pool Account. The CBN added that the funds from dormant accounts and unclaimed balances may be invested in Nigerian Treasury Bills and other government securities.
The CBN, however, said the new guidelines, which are a review of the guidelines issued in October 2015, exempted dormant accounts and unclaimed balances under litigation and investigation. The guideline reads:
- Open and maintain the “UBTF Pool Account”, 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.
- Refund the principal and interest (if any) on the invested funds to the beneficiaries not later than 10 working days from the date of receipt of the request, and where it is imperative to extend the timeline, a notice of extension shall be communicated to the requesting FI stating reasons for the extension.
The CBN also directed all banks and financial institutions to publicly disclose details of dormant accounts, unclaimed balances, and other financial assets on their official websites.
