BVN, NIN: Details of CBN New Guideline for Banks, Customers
As part of its effort to promote financial system stability, the Central Bank of Nigeria (CBN) has issued new operating guidelines to deposit money banks (DMBs) to properly profile depositors, with specific mention as regards biometric verification numbers and National Identity Numbers.
According to its latest circular to the commercial, merchant, non-interest and payment service banks, others; the CBN said that it has become necessary to strengthen the Know Your Customer (KYC) procedures in financial institutions under its purview.
The latest operational guideline is an amendment to Section 1.5.3 of the Regulatory Framework for Bank Verification Number (BVN) Operations and Watchlist for the Nigerian Banking Industry.
In the circular, the CBN told banks that it is mandatory for all Tier-1 bank accounts and wallets for individuals to have BVN and/or NIN. It is also compulsory for Tiers 2 & 3 accounts and wallets for Individual accounts to have BVN and NIN, the circular stated.
The Bank explained that the process for account opening shall commence by electronically retrieving BVN or NIN-related information from the NIBSS’ BVN or NIMC’s NIN databases and for the same to become the primary information for onboarding of new customers, and
It said all existing customer accounts/wallets for individuals with validated BVN shall be profiled in the NIBSS’ Industry Customer Account Database (ICAD) immediately and within 24 hours of opening accounts/wallets.
Implementation of the guideline
Effective immediately, Banks are not allowed to open new Tier 1 accounts and wallets without BVN or NIN. For existing Tier1 accounts/wallets without BVN or NIN, effective immediately, banks must place unfunded accounts/wallets on Post No Debit or Credit” until the new process is satisfied.
The new guideline provides that from March 1, 2024, all funded accounts or wallets without BVN/NIN would be placed on “Post No Debit or Credit” and no further transactions permitted.
The CBN said in the new guideline that BVN or NIN attached to and/or associated with ALL accounts/wallets must be electronically revalidated by January 31, 2024. CBN told banks to ensure all operated accounts/wallets, including accounts/wallets created through agents, are fully profiled in the NIBSS ICAD and tagged with valid and correct BVN and/or NIN.
The apex bank said enrolment of new customers by manually creating a customer profile and subsequently attaching a BVN or NIN is hereby strictly prohibited. “Where a BVN or NIN exists for a new customer, the regulated financial institution is requested to use same to electronically check the BVN database at NIBSS’ portal and NIN at NIMC portal”.
The CBN said where any or all of the underlying details of the BVN or NIN are inconsistent with the details provided by the potential customer, the onboarding process must cease immediately. However, the apex bank said the potential customer may wish to follow established protocols and seek to update the BVN or NIN details.
The guideline provides that if a potential customer does not have a BVN or NIN, the regulated financial institution may wish to commence the process of enrolling the individual into the BVN database and be guided by the extant protocols issued by NIBSS.
Banks are required to advise a new customer to visit the nearest NIN enrolment centre. CBN has effectively immediately stopped the Nigerian banks from using ‘placeholder BVN or NIN” to support the creation of any customer profile and shall be sanctioned accordingly.
Additionally, regulated financial institutions are required to profile all their customers’ accounts/wallets on NIBSS’ ICAD, and tag them with their unique identifiers within 24 hours of generating and assigning an account number to a customer (new or existing).
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