Grace Ashiru
Social media has become a strong tool that can bring people together from all over the world. In addition to bringing people together, the platforms have become a great way to find information, improve risk management, and make the customer experience better.
It’s easy to see why most foreign banks and businesses use it to improve their Know Your Customer (KYC) systems. In line with international standards, the Central Bank of Nigeria (CBN) has now told commercial banks that it is a required KYC policy in the financial services sector to get customers’ social media handles and digital IDs.
The central bank says that the new directive is meant to make it harder for people to commit financial crimes. This is what the CBN’s Customer Due Diligence Regulations 2023 report says, which was posted on its website and sent to all banks and other financial companies in the country.
But as of January 2023, there were only about 31.6 million active social media users in Nigeria, according to data from Statista. Based on statistics from the Nigeria Inter-Bank Settlement System (NIBSS), there were about 133.5 million active bank accounts in Nigeria as of 2021. This makes it hard to see how the CBN plans to put this policy into place.).
By asking for social media names as part of the Know Your Customer (KYC) process, financial institutions could use the information available on social media platforms to improve their due diligence efforts, increase security, and make the customer experience better
As banks continue to adapt to the digital age, it will become more important for them to use social media for KYC identification.
