CBN to freeze accounts without BVN, NIN April 2024

The Central Bank of Nigeria (CBN) has announced that from April 2024, accounts without Bank Verification Number (BVN) and National Identity Number (NIN) will be frozen.

The CBN’s directive was contained in a circular issued yesterday to all deposit money banks.

The circular was jointly signed by the Director, Payments System Management Department, Chibuzo Efobi, and Director, Financial Policy and Regulation Department, Haruna Mustapha.

The bank said the directive was part of efforts to promote financial system stability and strengthen the Know Your Customer procedures in all financial institutions.

The new directive announced by the CBN entails several pivotal alterations. Individuals holding Tier-1 bank accounts and wallets are now mandated to possess BVN and/or National Identification Number (NIN).

Tier-1 accounts are bank accounts that require minimal documentation usually the mere presentation of a BVN and a means of Identification before opening with a maximum withdrawal limit of N50,000 daily and a cumulative balance limit of N300,000.

The requirement for BVN and NIN remains applicable to individual accounts within Tiers two and three.

The account opening process will now involve electronically retrieving BVN or NIN-related information from the NIBSS’ BVN or NIMC’s NIN databases.

The circular read in part: “As part of its efforts in promoting financial system stability, it becomes necessary to strengthen the Know Your Customer procedures in financial institutions under the purview of the Central Bank of Nigeria.

“Accordingly, the CBN hereby issues an amendment to Section 1.5.3 of the Regulatory Framework for Bank Verification Number Operations and Watch List for the Nigerian banking industry.

“In this regard: It is mandatory for all Tier-1 bank accounts and wallets for individuals to have BVN and/or NIN. It remains mandatory for Tiers 2 and 3 accounts and wallets for individual accounts to have BVN and NIN.

“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 same to become the primary information for onboarding of new customers.

“All existing customer accounts/wallets for individuals with validated BVN shall be profiled in the NIBSS ICAD immediately and within 24 hours of opening accounts/wallets.”

As a result of the new guidelines, the bank said any unfunded account/wallet would be placed on “Post No Debit or credit until the new process is satisfied.

It added that all accounts/wallets would be electronically revalidated by January 31, 2024.

“Effective immediately, no new Tier-1 accounts and wallets should be opened without BVN or NIN. For all existing Tier-1 accounts/wallets without BVN or NIN: Effective immediately, any unfunded account/wallet shall be placed on “Post No Debit or credit until the new process is satisfied.

“Effective April 1, 2024, all funded accounts or wallets shall be placed on “Post No Debit or Credit, and no further transactions permitted.

“The BVN or NIN attached to and/or associated with all accounts/wallets must be electronically revalidated by January 31, 2024,” the circular added.

The bankers’ bank directed all Executive Compliance Officers, Chief Compliance Officers or Heads of the Compliance Functions to acquaint themselves with the attached guidance notes to ensure full and uniform compliance.

“To ensure uniform and full compliance, the Executive Compliance Officers, Chief Compliance Officers or Heads of the Compliance Functions are advised to acquaint themselves with the attached Guidance Notes, which becomes applicable to ALL institutions regulated by the CBN.

“Also, a comprehensive BVN and NIN audit shall be conducted shortly and where breaches are identified, appropriate sanctions shall be applied.

“Finally, all financial institutions regulated by CBN are required to apply strict compliance on restrictions on Tier-1 accounts/wallets as they relate to limits on transaction values and cumulative balances,” the circular noted.