About 45 million customers’ accounts with various banks and OFIs risk being closed down following their non-compliance with the Bank Verification Number (BVN) exercise.
This is coming on the heels of a Central Bank of Nigeria memo warning banks of serious consequences if they fail to take actions against such affected accounts.
In a memo to the Nigeria Inter-Bank Settlement System (NIBSS), Deposit Money Banks (DMBs) and Other Financial Institutions (OFIs) obtained by National Daily signed by Mr. Dipo Fatokun, Director Banking and Payment System, CBN warned banks and OFIs to ensure proper capturing of the BVN data and validate same before linkage with customers’ accounts.
The CBN also instructed them to ensure all operated accounts are linked with the signatories’ BVN; and ensure customer’s names on the BVN database are the same in all of his/her accounts, across the banking industry.
With the new circular, the apex regulator orders banks to report confirmed fraudulent individuals’ BVNs to NIBSS for update of the watch-list database; report the BVN of deceased customers to NIBSS for update on the BVN database; render returns to NIBSS for enlisting individuals involved in confirmed fraudulent activities, with the report signed by the chief audit executives.
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The new regulation also states that CBN (Banking Supervision Department) shall be granted real-time online access to the watch-list database while the chief audit executive of the customer’s bank shall be notified, where a bank needs to watch-list a customer of another bank.
CBN also mandates NIBSS to ensure BVN data are stored within the shores of Nigeria and shall not be routed across borders without the consent of the CBN while users of the BVN information shall establish adequate security procedures to ensure the safety and security of its information and those of its clients, which shall include physical, logical, network and enterprise security.
The CBN warned where a bank chooses to continue an existing business relationship with holders of account on the watch-list, the account holder shall be prohibited from all e-channels, such as ATM, POS, Internet Banking, Mobile Banking, including issuance of third-party cheques.
“A watch-listed customer shall not provide reference to another customer, neither shall he/she be allowed access to credit facility or guarantee credit facilities,” the new circular directed.
According to findings by National Daily, records from the NIBSS show that there were about 45.85 million total bank accounts unlinked, but when compared with the active accounts the number dropped to 15.72 million unlinked to BVN as of February 2017.
The record further shows that as of October 8th, 2017, the total BVN issued were 30,511,506