Single Customer View platform

It was in April 2022 that the Managing Director/Chief Executive of the Nigeria Deposit Insurance Corporation (NDIC), Mr. Bello Hassan, first announced that the corporation had developed a Single Customer View (SCV) platform that it planned to deploy to Micro-Finance Banks (MFBs) in order to eliminate delays often experienced in reimbursing depositors of MFBs that had collapsed on grounds of revocation of their licences by the Central Bank of Nigeria (CBN).

Mr. Hassan, who disclosed this, while receiving executive members of the National Association of Microfinance Banks (NAMB) who were on a courtesy visit to the NDIC management in Abuja, explained that the corporation introduced the SCV platform in order to strengthen its processes.

He said the platform would not only ensure rendition of quality, timely and complete data to NDIC by MFBs but also give complete position of depositors’ data at any given time which would go a long way in enhancing prompt reimbursement in case of bank failure.

The NDIC MD, however, said the corporation would expose the template for the platform to the association with a view to garnering more inputs towards optimising the innovation.

While speaking at the 19th edition of the NDIC workshop for the Finance Correspondents Association of Nigeria (FICAN) and Business Editors, held in Port Harcourt in November 2022, Mr. Hassan also gave further details on the SCV platform and the critical role it would play in helping the corporation ensure a faster and orderly resolution of liquidated banks.

He said: “In the area of scaling up the deposit insurance framework and ensuring faster and orderly resolutions of liquidated insured institutions, in May this year, with the active participation of the relevant stakeholders, we had developed and deployed the Single Customer View (SCV) platform for the Microfinance and Primary Mortgage Banks in order to strengthen our processes and procedure for data collection.

“The platform would not only ensure availability of quality, timely and complete data to the NDIC, but would eliminate delays often experienced in reimbursing depositors following revocation of institutions’ licences by the CBN.

“The final phase of the implementation of the SCV for deposit money banks (DMBs) will be achieved through the incorporation of the SCV template as part of the ongoing Integrated Regulatory Solution (IRS) jointly being developed with the CBN.”

Interestingly, the NDIC also ensured that one of the papers delivered at its annual workshop for FICAN and Business Editors, held in Owerri, in November last year, was titled, “Reimbursing Depositors faster in Nigeria using Single Customers View (SCV): Solutions and prospects.”

Speaking at the event, Hassan said the SCV played a key role in helping the NDIC to pay more than N1.6 billion to more than 40,000 depositors of the 179 MFBs and four Primary Mortgage Banks (PMBs) that were shut down by the CBN in May last year, adding that the corporation had been , “calling depositors of those institutions especially those that were not having Bank Verification Number (BVN) attached to their files to come forward so we can verify them in order to pay them the insured amount.”

He said: “We have introduced the Single Customer View (SCV) framework that has enhanced speedy payment of insured sums to depositors of closed banks; we have enhanced collaboration with the bar and the bench, leading to speedy dispensation of justice and more informed judgements on failed banks cases.

“We have equally put in place policy and framework on Alternative Dispute Resolution for out-of-court settlement, which had enabled us to resolve some hitherto protracted failed bank litigations; we have reviewed the Framework for Differential Premium Assessment System (DPAS) to make it more risk sensitive and account for significant developments that have taken place in the Nigerian banking system since its adoption in 2008.”

Heritage Bank

Despite the foregoing, the CBN’s announcement on June 3, this year that it had revoked the banking licence of Heritage Bank Plc, still sparked concerns in some quarters about what would happen to depositors’ funds trapped in the bank.

To douse such concerns, the NDIC, on the same day, issued a statement, announcing that it had commenced liquidation of Heritage Bank. The statement partly read: “In accordance with Section 55 sub-section 1 & 2 of the NDIC Act 2023, the Corporation has commenced liquidation process of the failed bank with immediate verification and payment of insured deposits to the bank depositors.

“Depositors of the bank that have alternate account within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account.

While depositors with funds in excess of N5 million will be paid liquidation dividend upon realisation of the bank’s assets and recovery of debts owed to the bank.” It, however, said that depositors of

The BVN and Single Customer View (SCV) platforms helped the NDIC to speed up reimbursement of depositors of Heritage Bank and the failed MFBs respectively

the defunct bank without alternate bank account in the industry should either, “visit the nearest branch of the bank with proof of account ownership, verifiable means of identification such as driver’s license, permanent voter s card, National Identity Card, together with their alternate account and BVN for the verification of their deposits and subsequent payment of insured sums or file online claim by visiting the NDIC website claims page.”

Giving an update on the payment of insured depositors of the bank in a chat with journalists on July 1, NDIC boss, Hassan, said that the corporation commenced payment to the failed bank’s customers on June 6 (three days after the bank was shut) and that it had already paid a substantial amount to the customers.

He, however, disclosed that account name discrepancies in BVN-linked alternate accounts of some customers were delaying the payment of their insured deposits.

He said: “We have already commenced the payment of customers since June 6. We have paid a substantial amount to the customers. What we leverage in making the payment is the BVN of customers.

We trace alternate accounts in other banks and pay them their insured amounts.” “There are some that we have challenges linking up because of some discrepancies between the names and others.

We are calling on customers that have not received their alerts in their alternate accounts to come forward and complete their verification forms so that we can pay them,” he added.

Indeed, the NDIC in a statement released on Sunday, August 11, 2024, signed by its Director, Communication & Public Affairs, Mr. Bashir Nuhu, the NDIC announced that it had paid 82.36per cent of the total insured deposit of N5 million maximum per depositor of the defunct bank.

BVN

The statement said: “In discharge of its deposit guarantee mandate, the corporation began the payment of the insured deposits of five million naira (N5,000,000) maximum per depositor within a record time of four days of the bank closure.

This was achieved using Bank Verification Numbers (BVN) as a unique identifier to locate depositors’ alternate accounts in other banks.

“However, depositors with balances exceeding five million naira have been paid the initial insured sum of five million naira, while the remaining balances (classified as uninsured deposits) will be paid as liquidation dividends upon realisation of the defunct bank’s assets and recovery of debts owed to the defunct bank.

“This unprecedented achievement of direct payment through BVNlinked alternate accounts without the need for depositors to visit NDIC offices or fill out forms, marks a historic shift for the NDIC in the prompt reimbursement of depositors with payment of about 82.36% of the total insured deposit to date.”

“It is instructive to state that, the remaining 17.64 per cent of the insured deposits yet to be paid were largely depositors whose accounts have post no debits (PND) instructions or have no BVN. Others are those with no alternative accounts in other banks or accounts with KYC limit on the maximum lodgment per day and are yet to come forward for verification.

These categories of depositors are presently being contacted by the corporation through telephone calls and text messages to come forward for verification.

As earlier mentioned in our press release, press conference and advert in the print and electronic media, the verification can be done by visiting any of the Corporation’s offices or online at www.ndic.gov.ng/ claims” it added.

On payment of uninsured deposits, which it said constitute the larger portion of the total deposits of the defunct bank, the NDIC said it was already working hard to ensure that all depositors with amounts in excess of the maximum insured amount of N5 million are timely paid through liquidation dividend from realisation of the defunct bank’s assets.

“The corporation has already initiated the process of debt recovery and realisation of investments and physical assets of the defunct bank to ensure timely reimbursement of the uninsured depositors of the defunct bank.

Subsequently, after the full payment of both insured and uninsured portion of deposits, the corporation will proceed with the payment of creditors in accordance with priority of claim as provided in the extant law.

We will like to reiterate that, all payments other than that of insured deposits, are subject to availability and realisation of assets of the bank in the form of liquidation dividend,” it stated.

Conclusion

Clearly, the BVN and Single Customer View (SCV) platforms helped the NDIC to speed up reimbursement of depositors of Heritage Bank and the failed MFBs respectively.