No new account/wallet (except Tier 1) shall be allowed to operate without Bank Verification Number (BVN), (except inflows), while any account/wallet (except Tier 1) without BVN shall be closed within 30 days.
This is according to the revised Regulatory Framework for BVN Operations and Watchlist for the Nigerian Banking Industry, released by the Central Bank of Nigeria (CBN).
The revised guidelines spell out sanctions and punishment for breaches by customers and other stakeholders and also seek to among others, define roles and responsibilities of participants in the BVN system; define BVN operations in Nigeria; access, usage and management of the BVN system; outline operations of the BVN Watch-list process; define sanction regime for breaches in BVN operations as well as deter fraud incidences in the Nigerian Banking Industry.
The apex bank, in the revised framework signed by the Director, Payment System Management Department, Mr. Musa Jimoh, said the move was in line with the bank’s mandate to promote financial system stability and reduce fraud and boost confidence in the system.
Customers who breach the BVN regulations and are subsequently placed on the watchlist shall not be allowed to enter new relationship with any participant, including banks and other financial services providers.
Also, a participant may choose not to continue business relationship with account/wallet (except Tier 1) holder on the watch-list.
The CBN further explained that in the event where a participant chooses to continue an existing business relationship with holders of account/wallets (except Tier 1) on the watch-list, such account/wallet (except Tier 1) holder shall be prohibited from all electronic channels including but not limited to ATMs, PoS, internet banking, mobile banking, USSD including issuance of third-party cheques.
It, however, inflows may be allowed, provided these are from legitimate sources, the apex bank added.
According to the new guidelines, a customer with watch-listed BVN shall not reference accounts, access or guarantee credit facilities and shall remain on the Watch-list for a specified period.
The bank also pointed out that in the event of a recurrence of breach, the penalty period shall run consecutively.
“This framework, without prejudice to existing laws, is a guide for the operations of the Watch-list in the Financial System.
“The Watch-list is a database of customers identified by their BVNs, who have been involved in confirmed cases of breaches, as defined within the framework,” a part of the statement read.
On the restrictions on the use of BVN, the bank stated that its use shall be restricted only to purposes specified by the CBN.
