The Central Bank of Nigeria (CBN) has given banks and other financial institutions a 30-day timeline to close accounts without Bank Verification (BVN).
Politics Nigeria Data from the Nigeria Inter-Bank Settlement System (NIBSS) showed that 57.39 million customers’ accounts have been linked to their BVNs as at April 8.
A review of the ‘Regulatory Framework for Bank Verification Number (BVN) Operations and Watch-list for the Nigerian Banking Industry’said the move was driven by the demand for effectiveness of Know- Your-Customer (KYC) and Customer’s-Due-Diligence principles and promotion of more safe, reliable and efficient banking and payment systems.
The policy was also meant to address the increasing incidence of fraud and to enhance public confidence in the banking industry, and provide a guide for BVN operations and watch-list activities carried out by financial institutions in Nigeria.
As part of the policy implementation plan, the CBN directed banks to link customers’ BVN to related accounts/wallets (except Tier 1).
This requires using the customer’s BVN generated after his/her enrollment to link accounts/wallets to which he or she is a signatory, after validation.
“No new account/wallet shall be allowed to operate without BVN (except inflows), however, any account/wallet without BVN shall be closed within 30 days,” the framework said.
It said delinking of customers’ BVN from accounts/wallets involves removing the BVN of a signatory (except for Directors/Beneficial owners) that is linked to an account/wallet.
The CBN said the BVN should be delinked upon the approval of the Chief Audit Executive of the customer’s bank.
“This delinking is for corporate or joint accounts and for activities not associated with breaches. Returns on delinked accounts/wallets (except Tier 1) shall be rendered to the Director, Payments System Management Department on a monthly basis,” it said.
Also, “Where there is no linked account, a nil report should be submitted while fraud management is a process aimed at using BVN to deter, prevent, detect and mitigate the risks of fraud in the banking industry,” it added.