The Central Bank of Nigeria (CBN) released a circular to banks and financial institutions stating its amendment to Know Your Customer (KYC) procedures. The amendment is part of an effort to strengthen KYC procedures and promote financial system stability. Below, we will explain what this means for bank account owners and how to navigate it.

The Mandate

Effective December 1st, 2023, the CBN mandates all Tier 1 accounts and wallets be linked to either a Bank Verification Number (BVN) OR National Identity Number (NIN). This applies to new and existing accounts.

A Tier 1 account is a bank account you can open without a means of identification. It requires no money to open the account and has a funding limit of N300,000.

Before the mandate, opening a Tier 1 account requires a passport photograph. Tier 2 and 3 accounts and wallets require an ID, passport photograph and linkage to a BVN or NIN.

The BVN and NIN linkage remains for opening new Tier 2 and 3 accounts.

Account Implementation and Restrictions

The CBN added timelines and restrictions in the circulars effective immediately:

1. New Tier 1 Accounts: All new Tier 1 accounts and wallets must be opened with a BVN or NIN.
2. Unfunded Tier 1 Accounts: All unfunded Tier 1 accounts without a BVN or NIN will be frozen and placed on “Post No Debit or Credit” status frozen) until the account is linked.
3. Funded Tier 1 Accounts: Effective March 1st, 2024, funded Tier 1 accounts without a BVN or NIN will be frozen and placed on “Post No Debit or Credit” status. Withdrawals, transfers or deposits can only be made once the account is linked to a BVN/NIN.
4. BVN and NIN Revalidation: The BVN and NIN associated with all accounts and wallets must be electronically revalidated by January 31st, 2024.

To avoid restrictions on your Tier 1 account, link your BVN or NIN to your account at your nearest bank branch.