House of Representatives has urged the Central Bank of Nigeria (CBN) to halt the implementation of its directive to commercial banks to add social media handle on “Know your Customer” requirements.
This was sequel to the adoption of a motion sponsored by the minority leader, Hon Kingsley Chinda, Hon Kelechi Nwogu and eight others at plenary yesterday.
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Moving the motion on behalf of his colleagues, Hon Nwogu said the recent directive by CBN to commercial banks on the addition of social media handles on “know Your Customer” requirements, made it mandatory for the banks to comply.
The lawmaker said the House was, “Aware that recently the Central Bank of Nigeria released its Customer Due Diligence Regulations, 2023, noting the importance of social media handles on ‘Know Your Customer’ would galvanise compliance with anti-money laundering and counter-terrorism financing provisions.
“Notes that obtaining the additional information, would be useful to financial institutions in accessing customers’ online presence and activities, thus enabling better assessment of potential risks associated with money laundering, terrorism financing and proliferation financing.”
He, however, observed that as laudable as the directive may appear, it may be unnecessary as it is likely to bear pressure on teeming Nigerian masses at the current trying period.
Nwogu said the directive by the CBN is in conflict with the provision of Section 37 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) on the right to privacy of citizens.
He argued that: “Banks in the country already have the names, telephone numbers, passport photographs, emails, National Identification Number (NIN), Biometric Verification Number (BVN), utility bills and other basic requirements with which to identify, know and monitor customers.
“There are better means of monitoring money laundering, terrorism financing, and proliferation financing, such as the Nigeria Police Force (NPF), Nigeria Financial Intelligence Unit (NFIU), the Economic and Financial Crimes Commission (EFCC), intelligence and crime tracking agencies, amongst others.
“If the directive takes effect, Nigerians who are not on social media, with large turn overs from their businesses and trades, would be compelled to or systematically excluded from formal banking systems with its attendant negative effects and implications.”
He also expressed worry about the untold hardships this directive will cause millions of Nigerians, especially the illiterates, or semi-literate business owners, traders and entrepreneurs living in the villages and rural areas who do not have social media handles.
The lawmaker further expressed concern that implementing the CBN’s directive at this point may clearly be unnecessary as it is likely to put more pressure on teeming Nigerian masses.
While adopting the motion, the House mandated the Committee on Banking and Currency (when constituted) to investigate the matter and report back within three weeks for further legislative action while the Committee on Legislative Compliance (when constituted) would ensure the implementation.
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