The
rate at which fraudulent activities is going on in the country these days is
becoming unbearable; the federal government of Nigeria and the CBN have being
on their toes to resolve the issue of frauds and to boost financial security in
most of the Nigerian banking industry; because of all these issues the central
bank of Nigeria on february, 2014 made it compulsory that all account holders
should have a bank verification number so as to enable the account holder to
have a single identity in all the banks in Nigeria; all he or she need to do is
to link it with his or her accounts.

The
essence of this system is to help the bank in the protection of their customers
from theft and other financial/ economic crimes growing in the banking industry
(orji, 2014)

The
Bank Verification Nlumber (BVN) is a great step taken by the Central Bank of
Nigeria, to strengthen the financial security and order in the banking sector
of Nigeria. One of the importance of the BVN is that transactions will be safer
once all protocol is duely observed. The essence of this BVN exercise is to ensure
that bank transactions are safer and fraudulent transactions are minimized, if
not totally eliminated. The central bank of Nigeria have put in alot of effort
to see the success of this excercise, but the general public do not know the
importance of the bank verification number; but they started seeing the
importance of the bank verification number when the cental bank made it clear
that the excercise will stop by october 2015.

The bank verification number system
uses biometric technology to register customers in the banking sector. It
records these physical features which are unique to individuals fingerprints
and the face; this techniques was made effective because every individual has
his or her own unique finger prints. The record would be used to identify the
person afterwards. Once a person’s biometrics have been recorded, and BVN
issued the account would be accessed through BVN. The major objectives of the
initiative are to protect bank customers, reduce fraud and strengthen the
Nigerian banking system.

Biometric enrolment is helpful to
people who cannot read and write. Their finger prints and pictures would serve
the same purpose as signatures. Multiple account holders would be covered with
a single registration in any of the banks where they have accounts.

BVN will help the banking system reduce
situations where loan defaulters, for instance, move from one bank to the other
and the banks extend new credits to them, without knowing their history.
Banks would be able to track transactions across all banks in Nigeria with more
ease.

1.2
STATEMENT OF THE PROBLEM