Dormant bank accounts: A complete guide
Billions of pounds lies in dormant bank and savings accounts which have been lost or forgotten about, but it’s free and easy to locate this money and claim it back. Here we explain how you can recover a dormant account in just a few steps.
Key takeaways
Financial accounts can be lost if your contact details are wrong or haven’t been updated
Providers make accounts dormant to protect against fraud and identity theft
You can reactivate an account by providing information to your bank to verify your identity
It’s estimated that £82 billion lies in lost and forgotten about bank accounts in the UK, according to the tracing service Gretel. These accounts have been made dormant because the person who opened them can’t be traced by the account provider.
If you think you may have an old account that now lies dormant, you could be missing out on any money locked within it. It’s free to reactivate an account and claim your money back, here we explain how.
What is a dormant account?
A dormant account is not just one that hasn’t been used for a while, it's one that has been left without any customer-initiated activity for an extended period. This period can vary significantly depending on the provider, from 12 months for current accounts to up to 15 years for savings accounts.
The dormancy period is a protective measure, safeguarding your money against potentially fraudulent activities, such as identity theft which could happen if your bank statements are sent to an outdated address.
How do accounts become dormant?
Several factors can lead to an account slipping into dormancy. Here are some of the most common reasons:
How do accounts become dormant?
Children’s accounts
Often opened by parents or guardians at birth, these accounts can be forgotten as the years pass, especially if the paperwork gets misplaced.
Moving house
A change of address without notifying the bank can result in missed communications, pushing the account towards dormancy.
Name changes
A new surname post marriage or a name change by deed poll might mean accounts under the old name get lost in the shuffle.
Lost paperwork
Without the necessary documents, it becomes challenging to keep track of, and manage, old accounts.
Where does money in a dormant account go?
If your account has been dormant for 15 years, the funds may be transferred to the Reclaim Fund under the Dormant Account Scheme, which supports charitable causes.
Since its inception in 2011, the Reclaim Fund has gathered over £600 million from dormant accounts to aid vulnerable groups.
But even if your funds have been transferred, you haven't lost them forever. The Reclaim Fund retains enough money to satisfy claims from account holders, ensuring you can still get your savings back.
How do I find a lost bank account?
If you have any paperwork from your lost account, such as a letter or email, this should include details about the account in question, such as an account number. You can then contact the provider and it will talk you through how to reactivate the account or access the money in it.
Reactivating a dormant account is straightforward. You'll need to provide detailed information to your bank or building society, such as the account number, holder's name, balance, and any statements you have. This will help verify your identity and reclaim your funds.
If you can’t find the necessary paperwork, another way to find your old bank account is through My Lost Account, a free service set up as a joint venture by the British Banker’s Association, The Building Societies Association, and National Savings & Investments (NS&I) to help you trace your lost account and savings.
How do I stop an account from becoming dormant?
The key to avoiding dormancy is to keep your account active. Regular transactions such as withdrawals, deposits, and cheque payments will keep your account in the clear. Remember, automated processes like interest payments don't count as customer activity. So, make sure to engage with your account in a way that registers as a deliberate action.
You should also make sure your provider has the correct contact information for you and if you change anything, such as your address, you update all of your providers.
If you are no longer using an account, instead of leaving it and risking it becoming lost, you can always close the account. You can withdraw any money in the account and move it elsewhere – such as a savings account with a better rate of interest.
Comparing savings accounts with MoneySuperMarket
When it comes to managing your savings effectively, choosing the right account is crucial. MoneySuperMarket offers a comprehensive comparison of savings accounts, including easy access, fixed rate bonds, and cash ISAs. With filters tailored to your individual needs and goals, finding the most suitable account is a breeze.
Frequently asked questions
How can I reclaim unclaimed Premium Bond prizes?
If you want to reclaim unclaimed Premium Bond prizes, you can enter your account number into the online prize-checker search on the NS&I website. If you’ve lost your holder number or documents, you are still able to reclaim your premium bonds. You are able to find your holder number by logging into the NS&I online service and checking your Premium Bonds account page. You are also able to call NS&I for a replacement Bond record and they’ll send it to you.
How can I reclaim funds from a deceased family members dormant account?
If a family member has passed away and left money in an account, you may have the right to the funds of the account registered in their name. You’ll only be able to reclaim funds if the account is classed as dormant – meaning it’s been inactive for 15 years.
You would have to provide evidence of your identity and your right to claim the money. If you have an iron-clad will, for example, this will make the process relatively hassle-free. It’s worth noting however that if the amount you’re trying to claim is exceptionally high, there may be more stringent rules and documentation you might have to provide. This means it might take longer to verify your identity and claim the money.
The more information you can provide, the easier it’ll be to verify your identity and reclaim the funds.
Does it cost money to reactivate a dormant account?
It is free to reactivate your dormant account with the My Lost Account service.
Does having a dormant bank account affect my credit score?
Only dormant credit accounts will affect your credit score as that involves you borrowing money. A dormant savings account won’t impact you credit rating.
Author
Rebecca Goodman
Personal Finance & Insurance Expert
Rebecca is an award-winning financial journalist with over a decade of experience writing for print and online media. Her mission is to take the jargon out of personal finance and to help everyone...
Reviewer
Collette Shackleton
Content Writer
Collette Shackleton is a highly skilled Content Writer who has over nine years’ experience creating helpful and engaging personal finance content for consumers. Collette shares her experience as a...
