Unclaimed Funds: Millions Lost to Inactive Accounts

Over the last five years, a staggering S/ 566.6 million has been transferred to Peru’s Deposit Insurance Fund (FSD) from accounts untouched for a decade. What can be done to prevent this?

How Abandoned Deposits Become State Funds

Peruvian financial regulations dictate that deposits, securities, and other assets untouched for ten years in a financial institution automatically transfer to the Deposit Insurance Fund (FSD). Once transferred, these funds are no longer the property of the original owner.

The FSD protects customers if a financial entity fails. It is funded primarily through premiums paid by financial institutions but also receives transfers of unclaimed deposits after 10 years of inactivity.

In 2024 alone, these unclaimed funds totaled S/ 131.1 million, according to FSD data.

Reasons Behind Inactive Accounts

Why does money go unclaimed? The Association of Banks of Peru notes causes range from forgotten small balances to the death or absence of the account holder, with heirs unaware of the funds.

Since 1999, FSD regulations require financial institutions to publish notices in the official newspaper “El Peruano” and a national newspaper, listing the asset type. Holders then have ten business days to claim the funds before they transfer to the FSD.

In October 2020, the Superintendence of Banking, Insurance and AFP (SBS) mandated that for assets exceeding one tax unit (UIT), companies must directly contact the holder or beneficiary about the impending transfer, giving them a chance to act.

The SBS requires documented communication attempts, such as written notices validated with RENIEC data, emails, texts, or phone calls. Still, the significant amount of abandoned money suggests these measures aren’t fully effective.

Expert Solutions to Reclaim Lost Funds

Luis Alfredo Moyo, a banking law specialist at the North Private University (UPN), believes the SBS must better enforce existing rules. He advocates for stricter regulations compelling financial entities to contact account holders or relatives before the 10-year mark.

“When a person opens a Savings account should include the data of a legatee; That is, a direct relative: its name, cell phone number and address. So the financial entity makes formal communication with this person, before transferring money to the deposit insurance fund,” said Moyo.

Individuals should also inform their heirs about their financial accounts. The SBS offers a service called ‘Informed heirs’ to help relatives find information about a deceased person’s accounts.

Click here to access the SBS report.

Jimmy Astocondor, a finance professor at Pacific Business School, calls for increased promotion of these informational tools for relatives.

“The regulator should be more proactive regarding these people’s funds. Nor should it be expected at 10 years to inform, but do it every year,” said Astocondor.

A recent report by the National Association of Unclaimed Property Administrators (NAUPA) found that states hold more than $80 billion in unclaimed property nationwide, highlighting the widespread nature of this issue.

Greater vigilance and proactive measures are needed to ensure that funds are reunited with their rightful owners and prevent further accumulation of abandoned money.