As of December 1, 2023, the Central Bank of Nigeria (CBN) has issued a circular mandating all commercial, merchant, non-interest, payment service banks, financial institutions, and mobile money operators to electronically revalidate BVN or NIN attached to accounts/wallets by January 31, 2024. Any funded accounts lacking BVN or NIN after March 1, 2024, will be subjected to a ‘Post No Debit or Credit’ status, preventing further transactions.
This directive from the CBN raises concerns for millions of bank accounts, highlighting the impending deadline for all accounts and wallets to be linked to either a Bank Verification Number (BVN) or National Identity Number (NIN).
According to a recent report by Enhancing Financial Innovation and Access (EFInA), 52% of unbanked adults already have the National Identification Number (NIN), whereas 5% of banked adults lack either a Bank Verification Number (BVN) or NIN. As of 2021, Nigeria boasts a total of 191.4 million bank accounts, of which 133.5 million are actively in use, based on data from the Nigeria Inter-Bank Settlement System (NIBSS).
Meanwhile, experts express optimism that this won’t be another case of the central bank refuting a previously circulated directive. It’s worth recalling that in March, the CBN had to clarify that the unique 11-digit Bank Verification Number (BVN), issued in collaboration with the Nigeria Inter-Bank Settlement System (NIBSS), does not expire. This clarification was prompted by widespread reports suggesting a 10-year validation for the BVN.
As of December 18, 2023, the latest data from the Nigeria Inter-Bank Settlement System (NIBSS) reveals a Bank Verification Number (BVN) count of 59.96 million within the banking industry. The EFInA report notes an increase in the adoption of diverse financial management methods, encompassing banks, non-banks, and informal channels, rising from 10% in 2020 to 20% in 2023.
Despite the issuance of the circular a month prior, BusinessDay’s visit to various bank branches has identified low compliance with the directive. After speaking with customers and assessing the situation, a report by BusinessDay quoted an undisclosed bank branch manager stating, “There has been no rush by customers whose accounts have no BVN or NIN. I don’t think customers are informed. If they knew, there would have been a rush by now.
The CBN has urged compliance officers to acquaint themselves with guidance notes and has announced an upcoming audit for both BVN and NIN, with sanctions for any breaches.
The EFInA report underscores an upward trajectory in financial service utilization, marked by increases in savings (2%), remittances (8%), and credit (4%), indicating improved financial inclusion. There’s a notable surge in digital financial services, with 45% of Nigerians using them in the past year, up from 34% in 2020.
