CBN instructs commercial banks to close all accounts whose owners do not have a BVN within 30 days

CENTRAL Bank of Nigeria (CBN) officials have given all commercial banks and other financial institutions a 30-day deadline within which to close accounts who owners do not have a bank verification number (BVN).

Data from the Nigeria Inter-Bank Settlement System (NIBSS) showed that 57.39m customers’ accounts have been linked to their BVNs as at April 8 this year. A review of the Regulatory Framework for Bank Verification Number Operations and Watch-list for the Nigerian Banking Industry, said the move was driven by the demand for effectiveness of know-your-customer and customer’s due diligence principles.

Nigeria's BVN policy was introduced to address increasing incidences of fraud, to enhance public confidence in the banking industry and provide a guide for BVN operations and watch-list activities carried out by financial institutions across the country.  It requires using a customer’s BVN generated after his/her enrolment to link accounts/wallets to which he or she is a signatory, after validation.

A CBN spokesman said: “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.

“This delinking is for corporate or joint accounts and for activities not associated with breaches. Returns on delinked accounts/wallets shall be rendered to the director, payments systems management department on a monthly basis.”

A watch-listed individual is barred from entering into new relationship with any bank. According to the CBN, in a situation that a bank chooses to continue a business relationship with an account holder on the watch- list, that person shall be prohibited from  e-channels, issuance of third-party cheques, shall not provide reference to another customer and shall not be allowed to access credit facility or guarantee credit facilities.

Also, individuals shall remain on the watch list for up to 10 years and penalties that applied to such shall apply to their accounts. Once a watch-listed BVN has served its term, the Nigerian Interbank Settlement System shall automatically delist the BVN and notify the stakeholders.