The Central Bank of Nigeria has issued two major directives aimed at strengthening the country’s financial system, barring large-ticket loan defaulters from accessing banking services and introducing sweeping changes to the Bank Verification Number framework, including a temporary fraud watchlist and new age restrictions for BVN registration.
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In a circular issued to commercial banks on Monday, the CBN directed all banks to restrict non-performing large-ticket obligors from accessing credit facilities, describing their activities as posing systemic risk to the financial system.
The apex bank defined large-ticket obligors as borrowers whose exposures exceed the Single Obligor Limit, materially affect a bank’s Capital Adequacy Ratio, or otherwise pose systemic risk to the financial system, as defined under the prudential guidelines for deposit money banks and recorded in the Credit Risk Management System or reports of licensed private credit bureaux.
Under the directive, any large-ticket obligor with a non-performing facility recorded in the CRMS or any licensed private credit bureau is prohibited from being granted additional credit facilities, including loans and other forms of direct credit.
The restriction goes beyond traditional lending. Such obligors are also barred from accessing banking facilities or contingent liabilities, including bankers’ confirmations, letters of credit, performance bonds, and advance payment guarantees.
The CBN further directed financial institutions to obtain additional realisable collateral from affected obligors to adequately secure existing exposures, as part of measures to strengthen collateral coverage across the banking sector.
The directive reinforces an earlier circular titled “Prohibition of Loan Defaulters from Further Access to Credit Facilities in the Banking System,” issued on June 30, 2014, which the CBN said was being strengthened to ensure consistency and effectiveness in curbing credit abuse by large-ticket obligors.
The regulator warned that it would monitor compliance across the banking industry and that noncompliance would attract appropriate regulatory sanctions in line with the provisions of the Banks and Other Financial Institutions Act 2020.
The instruction comes almost a week after the CBN directed financial institutions to conduct stress tests, although it remains unclear whether the two directives are connected or what specifically triggered the loan-related instruction.
Nigerian banks are currently undergoing a recapitalisation programme slated to end by March 31, with about 30 banks having met the minimum capital requirements announced in March 2024.
New BVN Framework: Fraud Watchlist, Age Restriction And Phone Number Rules
In a separate circular dated March 12, 2026, and signed by Musa I. Jimoh, Director of the Payments System Policy Department, the CBN issued an addendum to its Revised Regulatory Framework for Bank Verification Number Operations and Watch-list for the Nigerian banking industry. The new measures take effect from May 1, 2026.
The most significant change is the introduction of a mandatory temporary watchlist for BVNs implicated in suspected fraudulent transactions. Under the new framework, financial institutions are required to establish and maintain this watchlist as part of enhanced fraud monitoring. A BVN placed on the temporary watchlist may remain flagged for a maximum of 24 hours, during which period the BVN owner must be contacted to provide clarification regarding the identified transactions.
The addendum also introduces an age requirement for BVN enrolment, restricting registration exclusively to individuals who have attained the age of 18 years and above. This marks a notable shift in BVN policy, as the system had previously allowed registration for younger individuals.
In addition, the CBN has imposed restrictions on phone number amendments linked to BVNs. Under the new rules, amendments to phone numbers linked to a BVN will be permitted only once, a measure apparently designed to curb fraud and identity theft associated with repeated phone number changes.
Access to BVN databases will remain tightly controlled, with the CBN stipulating that access shall be exclusively granted to CBN-licensed financial institutions. However, the apex bank reserved the right to approve access in extenuating circumstances and in accordance with the provisions of extant laws.
The CBN said the new measures are part of its mandate of promoting financial system stability and are designed to ensure that BVN operations and watchlist procedures are consistently applied across all banks, other financial institutions, and payments service providers.
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