CBN to close millions of bank accounts in Access, UBA, Zenith, First Bank, and others

The Central Bank of Nigeria (CBN) has announced plans to close millions of bank accounts across various financial institutions that are not linked to a Bank Verification Number (BVN).

Blaise Ijebor, the CBN director of the Risk Management Department and Chief Risk Officer, who disclosed the plan at the Prembly Compliance Breakfast Dialogue on Thursday April 6, said the objective is to clean up the sector and reduce the growing incidence of fraud.

The BVN is a unique identifier that captures the biometric data of bank customers and is used to verify their identities and prevent fraudulent activities.

Speaking further, Ijebor noted that the apex bank has been working with the Nigerian Inter-Bank Settlement System (NIBSS) to address the growing incidence of fraud in the sector.

He added that the financial regulator was looking at commencing the exercise soon but did not give an indication of when the CBN would begin the clean up.

As of April 2, 2023, Legit.ng's analysis of the NIBSS website indicated that there were only 57.01 million registered BVN numbers out of the total 191.4 million bank accounts in the country, with 133.5 million active.

CBN's Ijebor further detailed the importance of closing bank accounts without BVN and highlighted three areas where cybercriminals are exploiting vulnerabilities.

The first is the Tier-1 account, which allows customers to open an account with minimal documentation and is mostly targeted at the unbanked and rural population.

He said: "This account is dominated by digital banks or fintech firms, and often lacks BVN linkage, which makes it an easy entry point for hackers."

"Secondly, some banks, especially digital ones, may not meet regulatory requirements, creating a second loophole for fraudulent activity.

"Lastly, hackers can exploit any vulnerability to gain access to bank accounts."

Ijebor mentioned that apex bank was working on improving agency banking and enabling agents to register BVN, which will help move Tier-1 accounts to Tier-2.