Finance Minister Clarifies on Dormant Account

The government and Bank of Uganda have jointly refuted misleading media claims about dormant accounts assuring that public money is safe.

Last week, media reports circulated of a bill before parliament to take away idle money from dormant accounts.

The story that assumed amendments to the National Payments System Bill 2019.

Yesterday a section of members of parliament under the National Finance Planning Committee issued a clarification on the matter as misleading

The MPs argued that idle money can be diverted to other sectors for national development.

The Ministry of finance team led by Matia Kasaija, and the Central Bank jointly refuted withholding and taxing ‘idle money.

The Finance Minister furthers explains that under the financial institution’s act 2004 and section 83 of the Microfinance Deposit-Taking Institutions Act 2003, a dormant account is one that has not had activity for two years and explains the procedures before the declaration of dormant.

The Financial Institutions Act 2004, allows for a period of 10 years for any amount of money to be transferred to the Bank of Uganda if dormant.

The Deputy Governor Central Bank clarifies such an action.

Banks have since the press claim stepped up to denounce claims of money sleeping on accounts taken over by the government.

In a press statement yesterday, the Uganda Bankers association pointed out the National Payment Systems Act, 2020 as key legislation of payment systems contrary to media reports.

Parliament passed the National Payments Systems (NPS) Act, 2020 in May 2020 and was assented to by the President on the 29th day of July 2020.

The Act is aimed at regulating payment systems beyond the traditional systems, providing safety and efficiency of payment systems, providing the functions of the Central Bank in relation to payment systems and providing for the establishment of the national payment systems council, among others.

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