U.K government resorts to dormant bank accounts for Covid relief. The government of the UK has come to the decision to retrieve funds in dormant bank accounts worth approximately $185 million to fund its coronavirus relief efforts.
So far, 30 banks have been voluntarily transferring money from dormant accounts to the government, including HSBC, Barclays, Clydesdale, Credit Agricole, Danske, Santander, Lloyds, and Bank of Scotland. The government has also proposed adding other types of assets that can be seized, such as insurance policies and share proceeds.
The U.K government made an announcement that “£150 million [$185.74 million] from dormant bank and building society accounts is to be unlocked to help charities, social enterprises and vulnerable individuals during the coronavirus outbreak.”
Culture Secretary Oliver Dowden detailed that “This includes accelerating the release of £71 million of new funds from dormant accounts alongside £79 million already unlocked that will be repurposed to help charities’ coronavirus response and recovery.”
In April last year, the U.K government published a report on the “The Dormant Assets Scheme: A Blueprint For Expansion”. Under this scheme, “UK banks and building society accounts collectively hold over £1.3tn of customers’ money in savings or current accounts that would be eligible under the Dormant Bank and Building Society Accounts Act 2008.”
At present, 30 companies including all major high street banks have participated in the scheme. Dowden shared that the banks “have voluntarily transferred funds from accounts that have been inactive for 15 years into the scheme and so far over £600 million has been distributed to good causes,” and that “the government is currently consulting on expanding the dormant assets scheme to include a range of financial assets from the insurance and pensions, investment and wealth management, and securities sectors.”
Consumers who wish to reclaim their funds can still do so even if their funds have been transferred to the scheme.