CBN Restates stance on BVN for forex transactions

The CBN has said that the Bank Verification Number, BVN, requirement for foreign exchange transactions posed no security risks to the bank accounts of those purchasing forex. Spokesman of the bank, Alhaji Ibrahim Mu’azu, said in a statement in Abuja, yesterday, that the excuses by critics of the policy were unfounded and that the requirement would therefore stay.

Below is the full statement: “The Central Bank of Nigeria (CBN) recently mandated all banks and licensed Bureaux de Change (BDCs) operating in Nigeria to provide Bank Verification Numbers (BVN) as part of the requirement for the sale of foreign exchange to their customers.

“It has, however, come to our notice that some customers are reluctant in disclosing their BVN to authorised dealers and buyers because of claims that there are attendant risks to the disclosure.

“It is, therefore, imperative for the bank to make the following clarifications:

“The adoption of BVN as a condition for the purchase of FOREX is expected to reduce the incidence of multiple purchases, round tripping and illicit transfer of funds, facilitate enforcement of authorized limits of forex sales to end users, sanitize the retail segment of the market and engender policies that will facilitate better allocation of the forex, based on genuine demands.

“The BVN is neither a payment instrument nor an account number and, therefore, could not be used to access any account by unauthorized users. The banks, BDC operators and even regulators use the BVN to validate the identity of a customer using some biometric information such as fingerprints and photograph obtained at the point of enrolment.

“For the avoidance of doubt, the provision of BVN by customers at the point of forex purchase or for any legitimate banking transaction with any of the above named institutions does not attract any security risk.  Rather it protects the customer against identify theft.”

Source: Vanguard