By Modupe Gbadeyanka

Heeding several calls by the Federal Government, Nigerians and experts in the financial institutions in the country, the Central Bank of Nigeria (CBN) has extended the Bank Verification Number (BVN) exercise to microfinance banks.

This was disclosed in a circular dated April 21 with reference number OFI/DIR/CIR/GEN/17/139 and signed by the CBN Director in charge of Other Financial Institutions Supervision Department, Mrs Tokunbo Martins.

The apex bank gave July 31, 2017 as deadline for this exercise, warning that any account not linked with the BVN would be “shall not be allowed to make withdrawals.”

In the circular titled ‘Letter to all Other Financial Institution (OFIs): Bank Verification Number (BVN) enrolment for customers,’ the CBN explained that the move became necessary because of the “absence of a unique identifier in the Nigerian banking industry,” describing this as a “major challenge inhibiting the effectiveness of the Know Your Customer (KYC) principle.”

“To address this challenge and complement the existing means of identification of customers, which include: the Driver’s License; the International Passport; the National Identity Card; and the Permanent Voter’s Card; the CBN, in collaboration with the Bankers’ Committee, launched the Bank Verification Number (BVN) Project in February 2014.

“The BVN is expected to also minimize the incidence of fraud and money laundering in the financial system, as well as enhance financial inclusion.

“The implementation of the BVN initiative, which started with the customers of Deposit Money Banks (DMBs), has been very successful.

“However, to avoid a broken identification link in the banking system, it has become necessary to extend the BVN enrolment to the customers of Other Financial Institutions (OFIs) especially as some OFIs are located in the rural areas of the country, and have customers that may not have enrolled with the DMBs.”

OFIs include microfinance banks, Primary Mortgage Institutions (PMI) and others.

CBN pointed out that the “BVN enrolment will support the achievement of the zero default credit targets set for the Participating Financial Institutions (PFIs) in the Micro Small and Medium Enterprises Development Fund (MSMEDF).”

It added that this exercise will “open opportunities for credit to millions of Nigerians without a standard means of identification.”

In the circular, the banking industry watchdog said OFIs are required to enrol their customers on or before July 31, 2017; conspicuously display notices sensitizing customers on BVN in the banking hall; ensure that all new customers have BVN; and forward to the Director, Other Financial Institutions Supervision Department schedule of customer accounts with BVN on August 7, 2017.

“Effective August 1, 2017, all customers without BVN linked to their account shall not be allowed to make withdrawals from those accounts,” Mrs Martins said.

She emphasised that the CBN “will monitor compliance with the requirements of this circular, and defaulters will be appropriately sanctioned,” warning them to be “guided accordingly.”

You would recall that recently, the Minister of Finance, Mrs Kemi Adeosun, had in a correspondence to the CBN Governor, Mr Godwin Emefiele, noted that the introduction of the BVN has immensely improved the integrity of the Federal Government payroll, from which more than 50,000 ghost workers had been detected.

However, the Minister lamented that operating bank accounts in MFBs without requirement for BVN had left a huge loophole for those who hide and launder proceeds of crime to escape detection by law enforcement agencies.

According to her, “Our ongoing efforts to verify the integrity of Federal Government personnel costs and purge the system of fraud and error has made extensive use of the BVN as a means of identifying recipients of multiple salaries, and salaries paid into accounts with names that differ from those held on our payroll records.

“The success of this effort has to date yielded the removal of over 50,000 payroll entries.”

Source: www.businesspost.ng/2017/04/24/breaking-cbn-extends-bvn-microfinance-banks-gives-july-31-deadline/

Some microfinance banks in Nigeria are worse than ponzi schemes.they disappear without notice.I would rather use a saving box or piggy bank than keep my money in those one man businesses.

singing Adeosun, fine girl
Better pikin, fine girl
.........
no hiding place for the looters.
pursue them even in their dreams

alizma:
nice one

lalasticlala ohhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh

Amazing decision

Why were they exempted in the first place?

Keneking:
lalasticlala ohhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh

Amazing decision

Yes, good policy to help checkmate thieves , vampires, godless, wicked and useless political rogues who have 43Million dollar vultures still flying around Ikoyi and different cities across Nigeria

thesicilian:
Why were they exempted in the first place?

bad belle, if she had include them in the 1st face and could not delivered properly, people like you would have condemned her approach.
to answer question, ask the elders in your house for the meaning of "one step after the other" and your problems will be over.

more holes to be dug, more safes to be purchased, more money to be abandoned in the micro finance banks etc

Beans much?

Bring everyone under the "net"....

Those who have gone there to hide will now start strategizing.

Good decision and kudos to our honorable finance minister, Mrs Adeosun.

Criminal minded people will not be happy about this.

Nice, another smart way to stash cash is through insurance, they ll even give you interest sef.

Good move. An added layer of checks and balances.

ok

better.all this micro finance banks,don wreck alot of business

alizma:

bad belle,... people like you... ask the elders in your house...

There's something seriously wrong with you.

Very good!

soon we will know how much everyone is sitting on.

After BVN, we should change our currency to force all the buried currencies out or have them buried forever.

ideaz:
Very good!

soon we will know how much everyone is sitting on.

After BVN, we should change our currency so force all the buried currencies out or have them buried forever.

Amazing position on the last sentence

What's the importance of this crap BVN reg when our account is still not safe after doing it?

God bless my President

You can't give deadline to something important like this. What is wrong with Nigeria? What about people outside the country with no BVN registration center?

gurunlocker:
What's the importance of this crap BVN reg when our account is still not safe after doing it?

imagine stupid question!!

gurunlocker:

It will be a stupid question to a stupid fellow.....

....
Truth is damn bitter.... When you are fully aware that all the billions of naira blown open by the whistle blowers kept in strange places, would have been kept safe in banks if not for BVN, then you appreciate the importance of BVN.

impressive saraki owns like 50 MFBs

Some people will be caged by this!

bb

BVN has made people to pile up money at home, but whistle blowers still spoiling things

wiringdpt:
You can't give deadline to something important like this. What is wrong with Nigeria? What about people outside the country with no BVN registration center?

what's ur problem, must u always complain? well no govt initiative has always been 100%
comfortable with all citizens. if their money is important to them, they would come back home.

modelmike7:
imagine stupid question!!

It will be a stupid question to a stupid fellow.....

Issorite