Customers yesterday got a breather on the Bank Verification Number (BVN), with the Central Bank of Nigeria (CBN) directing banks to ensure their uninterrupted enrolment on the platform.
CBN Governor, Mr. Godwin Emefiele
In a statement signed by its Director (Corporate Communications) Ibrahim Mu’azu, the CBN said although the time frame for the initial enrolment had elapsed, the exercise should go on indefinitely.
The BVN, which captures bank customers’ biometric data, such as fingerprints, provides unique identification for them and equally protects their accounts from unauthorised access, identity theft and fraud.
Customers who are yet to register are required to do so to avoid restrictions on their accounts.
“Account holders who are yet to obtain their BVN are enjoined to visit their banks and do the registration. There are two steps to the BVN process. The first step is to obtain a BVN while the second step requires the account holder to link the BVN with his or her bank account(s),” he said.
Mu’azu said an individual could enroll for a BVN without necessarily having a bank account. Such individual can then submit the acquired BVN at any bank he/she wishes to open an account.
He said linking BVN to bank accounts is now a one-stop-shop which enables account holders to register and link their BVN to their accounts in one location, irrespective of the banks in which they have their accounts. All these are aimed at making the process as seamless as possible.
“The BVN is neither a payment instrument nor an account number and therefore cannot be used to access any account by unauthorised users,” Mu’azu said.
LAGOS — Activities at the retail segment of the official foreign exchange market were grounded, yesterday, as end users avoided bureaux de change (BDCs), to avoid submitting their Biometric Verification Number (BVN) for foreign exchange transactions.
N100 note
This, however, resulted in sharp increase in demand for dollars at the black market, prompting the naira to depreciate to N230 per dollar from N225.
Recall that the Central Bank of Nigeria (CBN) made the BVN a criteria for sale and purchase of foreign exchange by banks and bureaux de change (BDCs) effective November 1.
Vanguard investigation, however, revealed that instead of foreign exchange end users submitting their BVN to BDCs as mandated by the CBN, most of them moved to the black market for their foreign exchange needs. This in turn increased demand in the market, prompting the parallel market exchange rate to rise to N230 per dollar from N225 at the close of business on Tuesday.
Confirming this development to Vanguard, Mr. Harrison Owoh, Chief Executive Officer, H.J Trust BDC said that “most of the customers were not willing to submit their BVN due to fear of what it might be used for. This has slowed down sales of forex by BDCs because we can’t sell without obtaining the BVN.”
An Abuja-based BDC manager, who spoke to Vanguard on condition of anonymity said that the problem was severe in Abuja, with BDCs having difficulty selling the dollars purchased from the CBN, last week.
“As I am talking to you, most BDCs in Abuja may not take dollars from CBN today (yesterday) because we have not sold the ones we bought last week. The customers do not want to submit their BVN for security reasons. They are patronising the black market, that is why the rate has gone up sharply, and I can tell you, the rate might rise higher if the situation persists.”
President of Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, however, blamed the situation on lack of adequate awareness on the part of the CBN before implementing the policy. He said that while ABCON, as a partner in progress with the CBN supports the use of BVN as criterion for foreign exchange transactions, the association had, however, called the attention of the apex bank to the need to delay implementation to allow massive publicity to create awareness among the populace.
“We had predicted what is happening now, that in the absence of adequate awareness, patronage will shift to the black market, leading to depreciation of the Naira in the market”, he said.
Submitting BVN not security threat—CBN
Director, Corporate Communications Department of CBN, Alhaji Ibrahim Muazu wondered why anybody should be afraid of submitting BVN for transactions, adding that there was no threat in giving BVN for foreign exchange transactions.
According to him: “This probably has to do with people with illicit flows, and not for fear of the BVN itself. And for people with illicit flows, they are avoiding documentation, the way they avoid the banks.
“To us, if not for the likely impact on the black market, it is a good development because it means the foreign exchange market is now demand driven. For example, if you go to the banks for ‘Form A’ foreign exchange transactions, it requires more than the BVN.
Submitting BVN for transactions is not a security threat. The BDCs cannot access the account details of their customers; they would just have the BVN for reporting purposes.
“The BVN is just an identity; the BDC cannot see your account details. It is just like asking you to submit your passport photograph. And the purpose is to make sure that people don’t buy foreign exchange above the limit allowed by the law.
There is a limit of $4,000 per individual per quarter. If one person buys $4,000 from one BDC, and another $4,000 from another BDC, there is no way anybody can verify it is the same person. All these things are supposed to be controlled by the BVN. All we want to clarify is that there is no threat in giving your BVN, it is an identity, in as much as you can give your passport photograph or even utility bills, as required for operation of dormant account.
“It is unfortunate if they are going to the black market and the black market does not have enough supply; but for us if they don’t buy from the CBN, if the CBN dollar is not sold, it would come back to us or there would be no demand for dollars next week, and this means we are conserving reserves. The only problem is the funding source for the black market will be limited and the price is high. But if I can give my BVN and buy dollars, maybe at N200, why should I go to black market and buy at N250? So the genuineness of the transaction is clear.”
Background to policy
The policy of making BVN criterion for foreign exchange transactions should have taken off August 15,2015 but was suspended by the CBN following criticism and warnings on the likely impact on the exchange rate of the Naira, and also to allow the Nigeria Interbank Settlement System (NIBSS) provide multiple channels for BDCs to verify BVN submitted by foreign exchange end-users.
The purpose of the policy, according to a CBN circular issued on October 20, was to stabilize the forex market, stem the rampant cases of forex leakages and illicit money transfers from Nigeria.
The CBN circular
The circular stated: “All banks and licensed BDCs operating in Nigeria as well as the general public are, therefore, put on notice that with effect from November 1, 2015, all customers desiring to purchase forex through all available channels in Nigeria must provide their BVN, which shall be validated by the CBN authorised forex dealer through the Nigerian Interbank Settlement System platform before the transactions are consummated.
“For the avoidance of doubt, the CBN shall from November 1, 2015, discontinue sale of forex to the BDCs that had not availed it the BVN of all its directors. Any authorised forex dealer that fails to provide the required information in its returns or provides a wrong BVN would be penalised and this may include the termination of the forex dealership authorisation.”
Consequently, on Monday, October 26, NIBSS unveiled a USSD and internet channel for verification of BVN. According to Mr. Oluseyi Adenmosun, the BVN Project Coordinator for NIBSS, BDC operators or anybody can dial the short code *565*1# on their phones from any part of the world for the validation. The USSD code when dialed will pop up a message asking for the BVN and the date of birth of the BVN holder to confirm the genuineness of the BVN. The BDC operators also have the option of using the NIBSS website portal for the validation. The service costs N20 per enquiry.
As the October 31st deadline for the enrolment for the Bank Verification Number (BVN) ended yesterday, many banks across the federation were swarmed with customers on Friday to complete their BVN just as many closed down their accounts to avoid any backlash.
CBN Governor, Mr. Godwin Emefiele
When The Nation visited some banks within Lagos metropolis and its environs, customers’ turnout was massively high.
In Festac town, Mushin, Ikeja, Yaba, Maryland, Ojota, Ketu, Mile 12, Ikorodu and its environs, most of the banks were overflowing with customers who were desperate to be captured.
At Zenith Bank premises in Matori, Mushin area of Lagos, bank officials sweat it out to enrol customers for the BVN, as most of the customers formed long queues.
The Central Bank of Nigeria (CBN) had extended the deadline for the BVN exercise to October 31 after banks were inundated by last minute customers to beat the earlier deadline back in July.
The Nation was reliably informed that the bank had anticipated the rush and had made provision with about three staff members handling the exercise of registering such customers outside while other banking activities went on inside.
Adeolu Olugbemi, a customer in one of the new generation banks told The Nation that due to his busy schedules he couldn’t complete the BVN exercise hence he was forced to close down his bank account.
He said, “several times I came to my bank with the intention of doing my BVN but each time I came the whole place was overflowing with crowd and since I couldn’t withstand the drudgery of standing on the queues for hours I had to close my account today (Friday). I can’t afford to face CBN penalty.”
Another customer who simply gave his name as Stanley told our correspondent he also couldn’t complete the BVN. “I was at the bank yesterday (Friday), when I got there, they ask us to pick numbers and I was 120 on the queue. After waiting for over one hour it still didn’t get to my turn so I had to close my account with the bank as suggested to me by one of the bank officials,” he said.
An official of Diamond bank in Wuse who also preferred not to be mentioned said although there was an upsurge of customers rushing to beat the deadline for the registration it was nothing compared to the previous deadline. She said the bank had made provisions and would ensure that they attended to all the customers at the bank for the registration.
At GT Bank Area 3 Garki, over 20 customers were seen waiting to either register or submit their BVN to the bank. One of the bank’s customers, Miss Onyeche Audu said, “I am just entering the bank and I am sure I will leave here soon because the bank is really managing the crowd.”
However, there were very few customers trying to carry out the BVN registration at Eco, Zenith, Fidelity, Stanbic IBTC and Unity banks.
Speaking with a cross-section of the officials of these banks, they confided in The Nation that they were optimistic that “after the registration, the CBN would get the cards ready after which the banks would distribute them to their customers.”
Meanwhile, a few hours to the close of banking business on Friday, the CBN issued a statement warning unsuspecting customers of the activities of those it described as “certain unscrupulous individuals sending unsolicited mails and text messages to unsuspecting bank customers, alerting them to the deactivation or suspension of their bank accounts due to uncompleted Bank Verification Number (BVN) registration process.”
The apex bank warned individuals and the general public that such “messages are intended to lure bank account holders to reveal their personal details with which the fraudsters could use to defraud them.”
The CBN and deposit money banks nor their employees or agents the statement said “would mever call bank customers or send e-mail/text messages requesting for passwords, card details or personal identification number (PIN).”
The Central Bank of Nigeria (CBN) has said that 32 million active bank accounts have yet to be enrolled on the Biometric Verification Number (BVN) by September.
CBN Governor, Mr. Godwin Emefiele
In a statement in Abuja, on Friday, Mu’azu Ibrahim, CBN Director, Corporate Communications, said CBN was concerned by the number of account owners yet to enrol, considering that the exercise would end by October 31.
The News Agency of Nigeria (NAN) recalled that the CBN, in collaboration with all banks in Nigeria, on February 14, 2014, launched the BVN, which is a centralised biometric identification system for the banking industry.
It aims at addressing issues of identity theft and fraud and will help to discover blacklisted customers, reduce queues in banking halls and standardise efficiency of banking operations.
The CBN also said the BVN would encourage banks to grant loans to Micro, Small and Medium Enterprises (MSMEs) and students in the country.
“One of the most potent arguments advanced by banks for not extending enough credit to prospective credit customers in Nigeria has been the absence of credible identity system.
“Thus, it was agreed that the scheme would make access to credit easier for low income earners in the society,” the apex bank said.
The CBN had initially put the deadline of BVN registration at June 30 but postponed it to October 31 because of low enrolment.
According to the statement, after 18 month of the exercise, empirical evidence shows that a good number of bank customers are reluctant and have not taken the exercise seriously.
“The emerging statistical trend of the BVN registration exercise shows that there are about 52 million active bank accounts in various banks.
“Out of this, total enrolment stands at about 20 million, out of which about 14 million accounts have been found linked to the BVN as of September.
“The question now is whether bank customers have been taking advantage of the extension to complete their BVN registration and also ensure that their various bank accounts have been linked to the BVN,” it stated.
The statement revealed that after the initial rush from June ending to July, there had been a steady decline in new BVN enrolment figures for August and September.
It stated that the development indicated that many bank account holders had continued to show apathy instead of taking advantage of the extension period to complete the registration.
“Bank customers are urged to take advantage of the remaining time to complete the registration. This is so as to avoid the commotion and melee experienced at various banking halls in the month of June.
“The CBN has made it clear that there would not be further extension after the October 31, 2015 deadline,” the statement said.
It said this meant that customers without the BVN-linked accounts might risk being restricted from normal operations of their accounts or access to their bank account balances.
Nigerians in London, United Kingdom, have expressed frustration over the compulsory payment of £30 (about N10, 000) for the registration of the Bank Verification Number, as directed by the Central Bank of Nigeria.
CBN Governor, Mr. Godwin Emefiele
Apparently sad over their plight, some of them during the week stormed the Nigeria High Commission in London to protest against the directive of the apex bank. Others took to the social media to vent their anger.
The CBN had recently extended the deadline for the BVN registration from June 30 to October 31, 2015 as disclosed in a circular issued to all deposit money banks operating in the country.
The Director, Banking and Payment Systems Department of the CBN, Mr. Dipo Fatokun, said the extension became imperative in order to give bank customers more time to participate in the enrolment exercise.
The circular had read in part, “It has come to our notice that the BVN registration has elicited tremendous interest from the Nigerian banks’ customers who crowded the banking halls in order to beat the deadline.
“Furthermore, there is the need to give Nigerian banks’ customers in the Diaspora ample time to enrol on the programme. The guideline for their enrolment is being finalised and will be released soon.”
Though the BVN registration in Nigeria is free, Nigerians living in London have had to part with N10, 000 to enrol on the exercise.
The directive was said to have been issued by the apex bank, as confirmed by the UK chapter of the All Progressives Congress and Zenith Bank.
The APC, UK chapter, had asked the bank on Twitter about the authenticity of the directive and the bank replied, saying, “The letter is genuine. The fee is as communicated by CBN and the enrolment company was contracted by the CBN. We trust this helps.”
Meanwhile, a user of a popular blogging platform, Nairaland, by the name klem93, said he was shocked to have seen photos of Nigerians thronging the Nigeria High Commission in London in frustration.
He wrote, “I thought it is going to be smooth sailing as I read that BVN for Nigerians in London had begun. I didn’t know it is going to be the same way as it went in Nigeria. A reader of my blog who lives in London wrote me an email: ‘The Nigeria High Commission in London needs an urgent overhaul. This afternoon, we Nigerians were treated like animals in Fleet Street, London, all because we wanted to do BVN for those of us who have accounts in Nigeria.
“Things soon became chaotic and someone called police on us. They allowed us to converge on the street and then locked us out. We were also being forced to pay £30.00 each, but none of the officials or the website could explain what the money was meant for. Is it not free in Nigeria?”
Eleojoe23, another user of the platform, protested, “£30? What for? They truly deserve an explanation. Maybe the high commission thinks that since they live in London, they should have enough money to spare. Do they think people just go out and pick money on the streets in London?”
Another user of the platform, Julioralph, said, “30 pounds for what? Members of staff at the high commission should be changed. Even the CBN is at fault as well; they don’t have proper plans for those abroad concerning this BVN stuff.”
Attempts to get the comment of the ministry’s spokesperson, Ogbole Ahmedu-Ode, were not successful as he could not be reached on the phone. He also did not respond to a text message that was sent to him.
But investigations at the Ministry of Foreign Affairs showed that the ministry was not involved in the BVN registration held in the UK.
A highly placed official in the ministry explained that the Nigeria High Commission in UK was not involved in the BVN registration, stressing that it was handled by a private firm which has no relationship with the embassy.
The source said that the high commission officials saw the posters advertising the BVN registration in London like other members of the public, noting that the “BVN registration was the private affair of a private company.”
“Neither the Ministry of Foreign Affairs nor the Nigeria High Commission in the UK was involved in the BVN registration; the programme was handled by a private company which has no relationship with the ministry or the high commission,” the official said on Friday.
Also, the Director, Corporate Communications Department, CBN, Mr. Mu’azu Ibrahim, could not be reached for comments as repeated calls made to his mobile phone did not connect.
The Central Bank of Nigeria has extended the deadline for the Bank Verification Number exercise till October 31.
A statement by the CBN said the decision to extend the BVN registration was due to passionate appeals from the public for the extension of the exercise after the expiration of the earlier deadline on Tuesday.
The apex bank said it noticed with satisfaction the level of compliance among the banking public and also acknowledged the difficulties which the people have gone through in the last few days in the quest to beat the registration timeline.
It added that arrangements are being made to enroll bank customers in Diaspora in the next few days.
