Economic Confidential

Nigerians, especially those in the informal sector who normally have difficulty identifying themselves during banking transactions can now heave a sigh of relief with the central bank adopting voters’ registration card as a formal form of identification.

And to show its seriousness over the matter, the Central Bank of Nigeria (CBN) has encouraged depositors who were denied the opportunity of using their voter cards for identification in banks to forward their complaints to any of its branches across the country.

The bank had last month directed banks to accept voter cards duly signed and approved by the National Independent Electoral Commission (INEC) for transactions as part of its Know Your Customer (KYC) programme to promote financial inclusion in the country.
Director of Corporate Communications of the CBN, Mr Ugochukwu Okoroafor said though no report had been made about banks rejecting the voters’ card as a form of identification, it was imperative to be proactive.

He said: “Though we are yet to hear that banks do not accept voter cards for identification, if there are depositors facing this problem, they should let the CBN know. Based on CBN’s study, 65 per cent of people are out of the financial system, representing over 90million of the 160 million Nigerian population.

“We want to ensure that 32.5 per cent of this figure is brought into the financial community before 2020. We would like to see a situation whereby Nigerians that have been excluded from financial activities, mostly women, embrace banking transactions. If identification is the major problem in the industry, we should do something about it to encourage more participation in the industry.”

According to him, the innovation was part of the three levels of Know Your Customer introduced to enable people with different means of identifications access the banking services.

He explained that lack of proper means of identification is one of the major problems affecting operations in the industry, adding that the inability of many people to have driving licence, international passports, among other major means of identification, resulted in the introduction of voter cards for banking transactions.

“What we are trying to do by the three levels of KYC initiative as stated in the policy guidelines, is to ensure that banks know their customers in details. Through this, banks would take lesser risks, guarantee the safety of funds, make more money and help in stabilising the system. It is not everybody that has the same level of identification.

‘’So, when there are multiple and varying means of identifications in the banking system, the more people come into the industry, the better for the growth of the industry and the economy in particular,” he added.

A circular titled “Inclusion of Independent National Electoral Commission, INEC, voter’s registration card as a means of customer identification”, was posted on CBN’s website in October directed all banks and other financial institutions, to extend the acceptable identification options to include the voters’ registration card.

Voters’ registration card has thus joined National Drivers’ Licence and the International Passport and National Identity card as means of identification by banks in Nigeria.

In another circular to banks, the CBN said the absence of uniformity in account opening procedure and documentation for prospective customers has continued to hinder the effectiveness of the Know Your Customer, KYC, requirements, in banks and other financial institutions in Nigeria.

The Central Bank said the “adverse implication of this on the fight against money laundering and the combating of financing of terrorism cannot be overemphasized.”

The bank said it has, in conjunction with the Committee of Chief Compliance Officers of Banks in Nigeria, developed a draft uniform account opening forms for adoption by banks and other financial institutions. This move would help increase the effectiveness of customer due diligence, and facilitate quick investigation of financial crimes by relevant agencies, according to the Central Bank.

Banks are expected to make their comments and critique, on the draft documents released by the Central Bank on three account opening forms (for individuals, for companies and for designated non-financial businesses and professions), for further work and conclusions on the documents to take place.