The Government has set up a new financial institution called Big Society Capital, to provide funding for charities and community groups using unclaimed money from dormant bank accounts.
Big Society Capital has gathered £600 million, two thirds of which comes from bank accounts that have been dormant for over 15 years, which it will lend to social enterprise projects that can prove their ability to repay the investment through the income they generate.
Bank accounts put to use
The Dormant Bank and Building Society Accounts Act 2008 makes it possible for money from dormant bank accounts to be re-invested in charitable and social causes, if it cannot be reunited with the account owners.
Banks and building societies can transfer balances from accounts that have been dormant for over 15 years into a Reclaim Fund, which is operated by the Cooperative Banking Group and approved by the Financial Services Authority (FSA).
The Reclaim Fund then transfers money to the Big Lottery Fund, which distributes it throughout Great Britain. Big Society Capital will now receive the English portion of the funding and has also received £50 million investments from Barclays, HSBC, LLoyds Banking Group and RBS.
Dormant accounts – reclaim your money
Before it hands money down to the Big Lottery Fund, the Reclaim Fund decides how much to keep back to repay customers that have tracked down their dormant accounts. You are entitled to reclaim your money at any time.
Lost bank, building society and National Savings and Investments (NS&I) accounts are easy to trace. If you know which provider your account was with, all you need to do is collect a tracing form from any branch, or print one off from the British Bankers’ Association or Building Societies Association websites.
If you’re unsure which provider your lost account is with, or the organisation no longer exists, then try mylostaccount.org.uk. You can search 42 banks, all UK building societies and all NS&I products free of charge by completing just one form online.
You can also use the postal services operated by the British Bankers’ Association, Building Societies Association and the NS&I if you prefer not to do it online.