July 05, (THEWILL) — The Federal High Court in Abuja has affirmed the exclusive statutory authority of the Nigeria Inter-Bank Settlement System Plc (NIBSS) to maintain and manage the Bank Verification Number (BVN) database in Nigeria, in accordance with the provisions of the Central Bank of Nigeria (CBN) Act, 2007, and the Banks and Other Financial Institutions Act (BOFIA), 2020.
Justice James Omotosho delivered the judgment on Friday in a suit filed by NIBSS against the Incorporated Trustees of Digital Rights Lawyers Initiative and others.
The Digital Rights Lawyers Initiative had challenged the legal authority of NIBSS to manage the BVN database, claiming it violated the constitutional right to privacy of Nigerian citizens.
In its suit filed through lead counsel, Wolemi Esan, NIBSS argued that it is statutorily responsible for initiating, developing, and regulating an integrated, nationwide system for electronic and paperless payments, funds transfer, and the settlement of transactions under the CBN Act and BOFIA.
The company sought the court’s declaration affirming its authority to manage the BVN database and a perpetual injunction restraining any entity or individual from contesting this mandate.
Specifically, NIBSS sought:
“A declaration that the plaintiff’s maintenance and management of the Bank Verification Number (BVN) data of Nigerians does not violate their constitutional right to privacy or any extant laws in force in Nigeria.
“An order of perpetual injunction restraining the 1st Defendant (Digital Rights Lawyers Initiative), and any other entity, person, or institution whether directly or through agents, officers, employees, privies, or any person acting under their instruction or control from contesting the plaintiff’s statutory authority to maintain and manage the BVN database.”
The CBN and the Attorney-General of the Federation were joined as second and third defendants, respectively.
In its defence, the CBN urged the court to uphold that NIBSS’s management of the BVN database is not only statutorily mandated but also constitutionally valid and critical for the stability of the nation’s financial system.
The apex bank argued that under Section 47(2) of the CBN Act, it is empowered to develop and regulate Nigeria’s payment and settlement systems, and that the BVN initiative is a vital tool for promoting financial security and protecting public interest.
Delivering judgment, Justice Omotosho held that the management of BVN data by NIBSS does not violate any individual’s constitutional right to privacy.
He ruled that the CBN’s powers to regulate the financial sector are clearly established in both the CBN Act and BOFIA 2020 and affirmed that NIBSS is legally empowered to maintain and manage the BVN database.
Consequently, the court issued a perpetual injunction restraining the Digital Rights Lawyers Initiative and any other persons or institutions from challenging the authority of NIBSS in this regard.
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