MICROCAPITAL BRIEF: Central Bank of Nigeria (CBN) Implements Bank Verification Number (BVN) Identification System for Customers in Lagos

The Central Bank of Nigeria (CBN), the country’s central banking authority, reportedly has initiated the first phase of a nationwide identification system upgrade for bank branches in Lagos. Under the revised system, CBN recommends that customers of Nigerian banks register for a bank verification number (BVN), a code that represents a customer’s identity and can enhance security for a variety of financial transactions. BVNs are created through the use of biometric data capture machines, which rely on data such as fingerprints and facial recognition technology to establish for each customer “a unique identity across the Nigerian Banking industry for easy identification and verification.” The implementation of BVNs is a part of CBN’s Financial Sector Strategy (FSS) goal of helping the country become “one of the top 20 largest economies in the world by 2020.”

Mr Ade Shonubi, the head of the BVN Project Management Team, reportedly stated that 1,000 banks in Nigeria have received biometric data capture machines and 16,000 BVNs have been created. Mr Shonubi explained that in the process of being approved for a BVN, each user will be required to provide identification and confirm their account information in person. After registration approval, the system can link the BVN to all accounts held by the user across all participating banks.

By Sarah Luo, Research Associate

About the Central Bank of Nigeria (CBN)

The Central Bank of Nigeria (CBN) was established in 1958 as Nigeria’s central banking authority. As defined by the act of parliament that created CBN, its statutory mandates are as follows: “to issue legal tender currency; to maintain external reserves; to safeguard the international value of the legal tender currency; to promote monetary stability and a sound financial system in Nigeria; and to act as banker and financial adviser to the Federal Government.” As of November 2013, CBN reports total assets of NGN 13.8 trillion (USD 84 billion).

Sources and Additional Resources

Ventures Africa: Nigeria’s Bank Verification Scheme flags Off In Lagos

Financial Technology: Bank Verification Number for a Safer, Better Banking

MicroCapital, May 14, 2014: Central Bank of Nigeria Bans Debtors Owing More than $1.5m to Liquidated Banks from Seeking New Credit

MicroCapital, March 20, 2014: Central Bank of Nigeria (CBN) Allocates 60% of $1.3b Micro-, Small, Medium-Sized Enterprises Development Fund to Promote Women’s Empowerment, Gender Equality

MicroCapital, March 3, 2014: Central Bank of Nigeria Announces Closure of 83 Microfinance Banks (MFBs), Denies Shutdown of Additional 600 MFBs

MicroCapital Universe Profile: Central Bank of Nigeria (CBN)

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