Effective March 1, 2024, the Central Bank of Nigeria (CBN) has instructed all financial institutions to cease transactions in funded individual accounts or wallets that are without Bank Verification Number (BVN) or National Identity Number (NIN). Additionally, all existing unfunded individual Tier1 accounts/wallets without BVN or NIN will be placed on “Post No Debit or Credit” immediately.
In a circular addressed to commercial, merchant, non-interest and payment service banks, other financial institutions, and mobile money operators, the CBN stated that all individual existing and new tier 1, 2, and 3 accounts/wallets must have BVN or NIN. This mandate is part of the CBN’s efforts to promote financial system stability and has led to the amendment of Section 1.5.3 of the Regulatory Framework for BVN Operations and Watch-List for the Nigerian Banking Industry (Guidelines).
The CBN emphasized the need to strengthen the Know Your Customer (KYC) procedures and stated that electronically retrieving BVN or NIN related information from the NIBSS’ BVN or NIMC’s NIN databases will become the primary information for onboarding new customers. Moreover, all existing customer accounts/wallets for individuals with validated BVN must be profiled in the NIBSS’ ICAD immediately and within 24 hours of opening accounts/wallets.
The circular outlined the following timeline for implementation:
– With immediate effect, no new Tier1 accounts and wallets should be opened without BVN or NIN.
– With immediate effect, any unfunded Tier1 account/wallet without BVN or NIN shall be placed on “Post No Debit or Credit”.
– Starting from March 1, 2024, all funded accounts or wallets without BVN or NIN shall also be placed on “Post No Debit or Credit” with no further transactions permitted.
– The BVN or NIN associated with all accounts/wallets must be electronically revalidated by January 31, 2024.
The circular warned that a comprehensive BVN and NIN audit will be conducted, and appropriate sanctions will be applied for any breaches identified. Financial institutions regulated by the CBN are required to strictly comply with restrictions on Tier1 accounts/wallets regarding transaction values and cumulative balances.
Financial institutions have been advised to familiarize themselves with the attached Guidance Notes to ensure uniform and full compliance.
– Elizabeth Adegbesan
