Dormant Assets Scheme Expansion

The government has been exploring various ways to expand the dormant asset schemes to include a wider set of financial assets beyond bank and building society accounts. Following the end of a consultation on the matter last year, the government announced plans to legislate for an expansion to the scheme to include additional assets across from the insurance and pensions, investment and wealth management and securities sectors in the scheme. 

In a speech to the House of Lords on 11 May 2021, the Queen confirmed plans to roll out the Dormant Assets Bill. The expansion of the scheme has the potential to unlock more than £880 million for social and environmental causes.

The existing dormant accounts scheme came into effect in November 2008. The scheme defines a dormant bank account as an account which has been continually open for at least fifteen years during which time no transactions have been carried out by the account holder or at his instruction.

Under the current scheme, banks and building societies transfer the money held in dormant accounts to a central reclaim fund. The reclaim fund is responsible for managing dormant account money, meeting reclaims and passing on surplus money to various charities for reinvestment in the community. The original account holder retains the rights to repayment upon providing satisfactory proof that the money is theirs. The Scheme has so far enabled over £745m to be released to support social and environmental initiatives across the UK.

If you have any questions about the scheme please speak to your usual FC contact. Alternatively, email hello@farnellclarke.co.uk.