The Nigeria Deposit Insurance Corporation (NDIC) has commenced payment of N5 million maximum deposit per depositor to defunct Heritage Bank customers. The payment was facilitated using Bank Verification Numbers (BVN) as a unique identifier to locate depositors’ alternate accounts in other banks.
This followed the revocation of Heritage Bank’s banking license by the Central Bank of Nigeria (CBN) last June.
The NDIC was appointed as liquidator and the corporation, in accordance with Section 12(2) of BOFIA 2020 and Section 55 subsections 1 & 2 of the NDIC Act 2023, commenced the process of verification and payment to insured depositors.
In discharge of its deposit guarantee mandate, the corporation began the payment of the insured deposits of N5 million maximum per depositor within a record time of four days of the bank closure.
However, depositors with balances exceeding N5million have been paid the initial insured N5 million, while the remaining balances (classified as uninsured deposits) will be paid as liquidation dividends upon realization of the defunct bank’s assets and recovery of debts owed to the defunct bank.
This unprecedented achievement of direct payment through BVN-linked alternate accounts without the need for depositors to visit NDIC offices or fill out forms, marks a historic shift for the NDIC in the prompt reimbursement of depositors with payment of about 82.36 per cent of the total insured deposit to date.
It is instructive to state that, the remaining 17.64 per cent of the insured deposits yet to be paid were largely depositors whose accounts have post no debits (PND) instructions or have no BVN. Others are those with no alternative accounts in other banks or accounts with KYC limit on the maximum lodgment per day and are yet to come forward for verification.
These category of depositors are presently being contacted by the corporation through telephone calls and text messages to come forward for verification.
The corporation said all depositors with amounts in excess of the maximum insured amount of N5 million are timely paid through liquidation dividend from realisation of the defunct bank’s assets.
The Corporation has already initiated the process of debt recovery and realisation of investments and physical assets of the defunct bank to ensure timely reimbursement of the uninsured depositors of the defunct bank.
Subsequently, after the full payment of both insured and uninsured portion of deposits, the Corporation will proceed with the payment of creditors in accordance with priority of claim as provided in the extant law. We will like to reiterate that, all payments other than that of insured deposits, are subject to availability and realisation of assets of the bank in the form of liquidation dividend.
The NDIC is committed to the safety of depositors’ funds in all licensed banks. Members of the public are enjoined to continue their banking activities without fear, as all other banks remain safe and sound.
