The number of bank account owners in Nigeria with Bank Verification Number (BVN) increased to 58.7 million as of September 12, 2023. This was revealed in the latest BVN registration data released by the Nigeria Inter-Bank Settlement System (NIBSS).
However, the data showed that registration for the BVN has slowed since the beginning of this year despite the recent moves by the Central Bank of Nigeria to close all bank accounts not linked.
At the end of 2022, the BVN database stood at 56.5 million. This shows that banks had recorded only about 1.4 million new BVN registrations in the last 8 months of this year plus 12 days in September. This is far lower than the average of 400,000 registrations per month recorded last year.
BVN vs bank accounts
According to NIBSS, active bank accounts in the country stood at 133.5 million as of December 2021. While data for 2022 has yet to be released, the figure is expected to be higher than that of the preceding year, which shows that there is still a wide gap between the registered BVN and the number of bank accounts.
However, industry analysts believe that the difference may not be much because multiple accounts can be linked to a single BVN. A Bank Verification Number is a unique number that allows individual accounts to be verified across the Nigerian banking industry. The unique ID number is issued to every bank customer at enrolment and linked to every account that the customer has at all Nigerian banks.
According to NIBSS, the BVN gives bank account owners a unique identity that can be verified across the Nigerian banking industry, while it ensures that customers’ bank accounts are protected from unauthorised access.
CBN’s plan to close unlinked accounts
The suspended CBN Governor, Godwin Emefiele, recently revealed plans to close millions of bank accounts that are not linked to BVN across several Deposit Money Banks (DMBs).
Emefiele, in a statement issued by the Director of the Risk Management Department and Chief Risk Officer, Blaise Ijabor said the objective was to clean up the sector and reduce the increasing incidence of fraud in the financial sector.
As part of their efforts to combat this problem, 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.
According to him, the objective of this initiative is to clean up the financial sector and reduce the growing incidence of fraud. He further explained that the CBN has observed that many bank accounts are not linked to the BVN, making it difficult to track fraudulent activities.
The CBN’s decision to close millions of bank accounts that are not linked to the BVN was anticipated to encourage customers to update their records and link their bank accounts to the BVN.
However, the impact of the pronouncement has yet to be felt as the rate of registrations for the number has been declining.