CBN to Freeze Bank Accounts Without BVN or NIN from March 2024
By Patience Ikpeme
In a significant move to enhance financial security and promote customer due diligence, the Central Bank of Nigeria (CBN) has announced that it will freeze bank accounts without Bank Verification Number (BVN) and National Identity Number (NIN) starting from March 2024. This decision is part of a series of sweeping amendments to the regulatory framework for BVN operations and watch-list for the Nigerian banking industry.
The new directives, which affect account holders across all tiers, mark a substantial shift in banking compliance and customer requirements. Effective immediately, individuals holding Tier-1 bank accounts and wallets, which typically require minimal documentation and have maximum withdrawal and cumulative balance limits, are now mandated to possess either a BVN or NIN. This requirement also applies to individual accounts within Tiers 2 and 3.
To streamline the account opening process, the CBN has introduced electronic retrieval of BVN or NIN-related information directly from the NIBSS’ BVN or NIMC’s NIN databases. This data will serve as primary information for onboarding new customers. Additionally, existing individual customer accounts with validated BVNs will now be profiled in the NIBSS’ ICAD within 24 hours of account opening.
The implementation procedures for these changes are multifaceted. Opening new Tier-1 accounts and wallets without BVN or NIN is strictly prohibited with immediate effect. From March 1, 2024, funded accounts without BVN or NIN will be placed on restrictions, and unfunded accounts will remain restricted until compliance is met. Furthermore, all BVN or NIN associated with accounts/wallets must be electronically revalidated by January 31, 2024.
The CBN has strongly advised compliance officers to thoroughly review the Guidance Notes accompanying the circular, as they apply to all institutions regulated by the CBN. Additionally, a comprehensive BVN and NIN audit is imminent, and appropriate sanctions will be imposed on identified breaches.
The revised protocols for onboarding new customers emphasize the prohibition of manual creation of customer profiles with subsequent BVN or NIN attachment. Instead, mandatory electronic authentication using BVN or NIN details for new customers is now required. Any inconsistencies between the provided information and the retrieved BVN or NIN details will halt the onboarding process.
Furthermore, banks are now mandated to profile customers’ accounts on NIBSS ICAD within 24 hours of generating an account number.
These amendments, according to the CBN, are designed to fortify the integrity and security of the Nigerian banking system. The apex bank has underscored the importance of compliance with these directives for all regulated financial institutions to ensure seamless operations and avoid penalties.
By implementing these stricter measures, the CBN aims to enhance financial inclusion, promote customer identification and verification, and strengthen the overall security of the Nigerian banking sector.
