PAYABLE ON DEATH

“Payable on Death” (POD) is a term often used in financial contexts to refer to a type of arrangement that allows the assets of an individual to be directly transferred to a designated beneficiary upon their death.

In Nigeria, a “Payable on Death” (POD) account is similar to those in other countries. It is a type of financial account that allows the account holder to designate a beneficiary who will receive the funds upon the account holder’s death. This setup helps to bypass the probate process, making it easier and faster for the beneficiary to access the funds.

To set up a POD account in Nigeria, the account holder typically needs to:

Visit the Bank: Go to the bank where the account is held.
Fill Out Forms: Complete the necessary forms to designate a beneficiary.
Provide Identification: Present valid identification for both the account holder and the beneficiary.
Submit Documentation: Submit the completed forms and any required documents to the bank.

Difference between next of kin and pay on death

The terms “next of kin” and “payable on death” (POD) refer to different concepts related to inheritance and the distribution of assets. Here’s a breakdown of the key differences:

Next of Kin

Definition: “Next of kin” refers to a person’s closest living relatives. This usually includes a spouse, children, parents, and siblings, but the exact definition can vary depending on local laws.
Role: Next of kin may have certain rights and responsibilities, such as making medical decisions or arranging for the disposition of the deceased’s remains if there is no will or other directive.
Inheritance: If someone dies without a will (intestate), their estate is distributed according to the laws of intestate succession, which usually prioritize the next of kin.
Legal Standing: The next of kin does not automatically have the right to access specific accounts or assets unless they are designated as a beneficiary or the estate goes through probate.

Payable on Death (POD)

Definition: A POD designation is a financial arrangement where an account holder names a beneficiary to receive the assets in the account upon their death.
Role: The POD beneficiary has no rights to the funds while the account holder is alive. Upon the account holder’s death, the funds pass directly to the beneficiary without going through probate.
Inheritance: The beneficiary named on a POD account receives the assets directly, bypassing the intestate succession process and any claims by the next of kin.
Legal Standing: A POD designation is a legal agreement with the bank or financial institution, and the designated beneficiary must be explicitly name.