Sh3.2bn lie dormant in M-Pesa accounts

A staggering Sh3.2 billion is lying dormant in M-Pesa wallets, forcing Safaricom to hand over the funds to the Unclaimed Financial Assets Authority (UFAA).

This amount represents 96.3 per cent of the unclaimed billions from inactive mobile money accounts as of November 11, 2024, according to UFAA.

In addition to Safaricom's unclaimed funds, Airtel and Telkom Kenya subscribers have failed to claim Sh114.3 million and Sh7 million respectively.

Mobile wallet accounts that have been inactive for more than two years, often due to the death of the account holder, migration out of the country or unreplaced SIM cards, are the source of these funds.

"A deposit made by a subscriber with a utility company to secure the provision of services or any amount paid in advance for utility services that remains unclaimed for more than two years after the termination of the services shall be presumed abandoned," the UFAA Act states.

Mobile Network Operators (MNOs) such as Safaricom, Airtel and Telkom are required by law to surrender such idle funds to the UFAA by November 1, each year.

Failure to comply can result in penalties ranging from 25 per cent of the assets held to daily fines of between Sh7,000 and Sh50,000.

Despite these measures, the sheer number of dormant accounts and the small amounts involved, spread across millions of users, make it difficult and costly for companies to trace the rightful owners.

Family members of the deceased can still claim the funds if they can provide proof of death and a Letters of Administration giving them powers over the deceased's estate.

The volume of unclaimed assets has increased significantly in recent years. In 2024, mobile operators surrendered Sh827.7 million in unclaimed assets, up from Sh541.7 million in 2023.

This increase reflects a larger trend of rising unclaimed assets across different sectors. By November, the total value of unclaimed cash, shares and dividends surrendered to the UFAA had reached Sh75.5 billion, up 21.7 per cent from Sh62 billion in June.

These assets include Sh39.4 billion worth of shares linked to prominent politicians, tycoons and former government officials. This is a sharp increase from Sh30 billion in 2021 and Sh16.42 billion in 2017.

In addition, the number of safe deposit boxes surrendered containing jewellery, title deeds and treasury bills rose to 3,737 from 1,953 in June.  UFAA has also taken custody of 9.87 million unit trusts and billions in local and foreign currencies.

Unclaimed assets are not limited to mobile wallets. They include dormant bank accounts, uncashed bank cheques and abandoned safe-deposit boxes.

Despite these assets, only 1.9 per cent of unclaimed assets have been reunited with their rightful owners.UFAA's mandate requires companies to actively search for the owners of assets before handing them over.

However, the authority has urged Kenyans to be more proactive in claiming their assets. Many Kenyans have shown little interest in pursuing assets that rightfully belong to them or their families.

In some cases, inheritance disputes have delayed efforts to reunite assets with beneficiaries. Other obstacles include the secrecy surrounding the deceased's assets and the lack of wills. Efforts to trace rightful owners face logistical challenges.

Traditional methods, such as publishing names in newspapers or on websites, have proved ineffective due to the large number of accounts and minimal individual balances.