CBN instructs banks to seek customer consent before sharing customers’ personal data, Payment service

CBN instructs banks to seek customer consent before sharing customers’ personal data, Payment service

  • The Central Bank has published new guidelines directed to commercial banks and Fintech companies
  • The Guidelines among other things is seeking to protect customers' data and have instructed consent must be sought first
  • The growing number of fintech companies has raised concerns about privacy, and the use of personal data

The Central Bank of Nigeria (CBN) has directed commercial banks, and Fintech companies not to share customers’ data without their consent.

The apex bank stated this in its “Operational Guidelines For Open Banking In Nigeria” released on its website.

Open banking requires that banks share their customers’ data with other competing financial institutions for the purpose of marketing and deployment of digital banking products and services.

CBN icustomers’ personal data, Payment service
CBN governor, Godwin Emefiele Credit: Chris J. Ratcliffe
Source: Getty Images

The Nation reports that in the guidelines, the CBN instructed:

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“Bank customers’ consent be obtained in the same form the agreement was presented and a copy of the consent of the customer shall be made available to the customer and preserved by the participants.”

The apex bank also stressed that that participants in open banking shall adhere strictly to security standards when accessing and storing data, and shall be subject to minimum privacy, operational, risk management and customer experience standards.

The CBN added:

"Henceforth, the consent of the customer shall be re-validated annually, stating that where the Application Programming Interface Consumer (AC) had not used the service for 180 days, the participant shall ensure that the connection is configured to terminate upon expiration of the consent."

More details from the Guidelines

Details from the Guidelines also noted that appropriate customer authentication methods such as multi-factor authentication shall be established to reduce the chance of identity theft or fraud.

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It also directed that customers shall always have control over their data and be able to access, manage or withdraw their consent at any point in time. It also states that participants shall develop and agree on a consent management mechanism which includes a clear set of policies and procedures.

The CBN also recognised the existence of an ecosystem for Application Programming Interface (API) in the banking and payments system.

It said it was also aware of various efforts in the industry to develop acceptable standards among stakeholders.

Ecobank leads as 10 commercial banks spend over N400bn on staff salaries

Meanwhile, Legit.ng had earlier reported that working in the banking industry is a dream for many Nigerian graduates because they believe there is a lot of money to be made

The report showed how ten commercial banks paid workers salaries and wages of over N400 billion in 2021.

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The amount captured in the report only covers salaries and wages and does not include other staff costs, or pension contribution that makes up personnel cost.

Source: Legit.ng

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