Finance Minister Urges CBN To Extend BVN To Microfinance Banks

Minister of Finance, Kemi Adeosun
Minister of Finance, Kemi Adeosun

Minister of Finance, Kemi Adeosun, has advised the Central Bank of Nigeria, CBN, to extend the Bank Verification Number, BVN, policy to individuals who have accounts in Microfinance Banks, MFBs.

The Minister said the move will make for the easy detection of bank accounts that are being operated in such banks by ghost workers and other syndicates.

Director of Information at the Ministry of Finance, Salisu Dambatta, in a statement issued on Monday, said that the Minister had already written to the CBN Governor, Godwin Emefiele, on the issue.

Adeosun noted that the introduction of BVN by the CBN had led to the detection and removal of more than 50,000 ghost workers from the payroll of the federal government, thereby saving the country billions of naira.

She however added that some individuals who are intent on defrauding the nation are taking advantage of the fact that accounts in Microfinance banks could be operated without the customer being required to present his or her BVN.

Such individuals, she said, through the MFBs are now able to hide and launder proceeds of crime and successfully escape detection by law enforcement agencies.

Adeosun noted that it was discovered prior to the deadline for obtaining the BVN, that there had been movement of a large number of salary accounts of federal employees from commercial banks to microfinance banks.

“This is a suspicious activity and we have already commenced a review of such cases to identify and investigate any cases of fraud,” the Minister was quoted as saying.

She also acknowledged “that extending the requirement for BVN to Microfinance Banks may put a huge financial strain on the smaller Microfinance Banks” but added that “some MFBs such as National Police Force Microfinance (NPF), have over 27,000 salary accounts” and that government’s “inability to perform checks on such a large number of salary earners is a key risk.”

The statement further read: “I am therefore seeking your cooperation to enforce compliance with BVN on any MFB with over 200 active salary accounts or those above a certain size.

“This will support the Federal Government’s efforts at reducing leakages to create headroom for the capital projects that will support the growth of the economy.”

The CBN had, in September 2016, announced that it would extend the BVN policy to Microfinance banks but the exercise has yet to take off.