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In Another Regulatory Clampdown, CBN Bars Fintechs From Using BVN For KYC

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The Central Bank of Nigeria (CBN) has reportedly barred fintech companies and other non-bank financial institutions in Nigeria from providing the Bank Verification Number (BVN) validation service.

This was disclosed in an email Paystack sent to its customers. The fintech firm said, “We’ve recently been made aware of a regulatory directive from the primary custodian of Nigeria’s BVN service to all their partners to suspend the provision of the BVN validation service to their third-party partners. This directive affects every non- bank in Nigeria that offers BVN validation service.”

The company said in line with the development, it has temporarily suspended its BVN validation service effective midnight of April 8, 2021.

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This new regulation comes off the heels of the Securities and Exchange Commission also banned Bamboo, Chaka, Trove and Rise.

The company said in line with the development, it has temporarily suspended its BVN validation service effective midnight of April 8, 2021.

Before now, the CBN AML/CFT Regulation 2018, allowed Banks and other financial institutions to use BVN as forms of identification for users who wanted to open an account.

The alternative for the fintechs for now to verify their customers is probably the National Identity Number (NIN)

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