Uche Amunike
Lifeandtimes News Writer
The latest introduction of more stringent Bank Verification Number (BVN) regulations by the Central Bank of Nigeria (CBN) reflects a necessary response to the evolving nature of financial fraud in an increasingly digitalized economy, as the CBN new BVN rules should exceed reactive enforcement to real time risk management, in line with global best practices.
According to a circular issued by the CBN, it stated that the amendments to the Revised Regulatory Framework for BVN Operations and Watchlist for the Nigerian banking industry 2021, are in tandem with its mandate to promote financial stability.
As from May 1, a temporary watchlist will be introduced for accounts linked to suspicious transactions. Financial institutions are now required to flag such BVNs for about 24 hours and contact the account holder for clarification.
Also aimed at protecting bank customers in the CBN new Bvn rules are the following key elements: Since the Bvn was introduced in 2014, it has remained central to identity verification in Nigeria’s banking system as it linked customer accounts through biometric data. It has made a lot of impacts so far.
According to the Nigeria Inter-Bank Settlement System, data shows that fraud losses declined sharply to N25.85 billion in 2025 from N52.26 billion in 2024. This represents a 51% reduction.
The volume of reported fraud cases also dropped from over 123,000 in 2021 to 67,515 in 2025. These figures demonstrate that even as further attempts persist, containment mechanisms and detection are improving. Still, the wider context remains troubling. According to a report by Sumsub in 2025, Nigeria recorded a fraud rate of 4.44%, which is one of the highest rates recorded globally and ranking 110th out of 112 countries in this Global Fraud Index.
As for Tanzania, it topped the list at 4.89%, while countries like South Africa and Kenya recorded notable improvements with fraud rates declining by 26% and 15.5% respectively in 2025. These comparisons show the urgency for Nigeria to intensify its fraud prevention strategies.
It was against this backdrop that a 24 hour temporary watchlist was introduced for suspicious BVNs. It became a welcoming innovation as it represents a more nuance approach than the blanket account freezes that have often drawn public criticisms.
Restricting BVN enrollment to individuals aged 18 and above addresses a long-standing ambiguity around identity ownership. The CBN is reinforcing accountability within the financial system and closing gaps that fraudsters could exploit by eliminating proxy enrollment for minors.
In all, limiting changes to phone numbers linked to BVNs to a single instance raise significant concerns. In a country where SIM swaps, device theft, and multiple line usage are widespread, this rule may likely create unintended hardships for genuine customers.
A stolen or compromised phone could effectively lock a user out of their financial identity, thereby undermining the very trust the policy seeks to build. Without nearly defined exceptions or safeguard, the measure risks being both impractical and counterproductive.
The idea of restricting access to Bvn databases exclusively to licensed financial institutions is however, a step in the right direction. Data protection is fundamental to financial stability and more stringent control reduces the risk of breaches and misuse.
Yes, such exclusivity must be followed by stringent oversight to ensure compliance with privacy and data protection standards.
Very importantly, the evolving nature of fraud demands more than regulatory tightening. According to PriceWaterHouseCooper, artificial intelligence is rapidly transforming the fraud landscape, enabling criminals to deploy fake technologies, automate scams and scale operations with unprecedented speed. This underscores the need for more advanced and adaptive security measures.
One of such measures is the deeper integration of biometric verification systems. Straightening the linkage between BVN and the database managed by the National Identity Management Commission (NIMC) could enhance identity, authentication through facial recognition and fingerprint verification.
Biometric identifiers offer a more reliable layer of security, unlike phone numbers that can be easily compromised.
Improved collaboration between banks and telecommunications operators is also very critical. Fraud Schemes often exploit the disconnect between these two sectors particularly in SIM swap incidents and unauthorized account access. It is essential to apply a coordinated, intelligence sharing framework in order to close these gaps.
The CBN new Bvn rules is commendable, but it still has its flaws. The gains recorded in fraud reduction show that progress is possible, but Nigeria’s global ranking serves as a reminder that there is so much work to be done.
The success of these reforms, however, will depend on careful implementation, a willingness to adapt to emerging threats and continuous review.
A secure financial system cannot only rely on restrictions. It must also be built on innovation, flexibility and an unwavering commitment to protecting consumers.
