Bank Client Data Compilation Window Draws to Close

Feb 26 , 2022

A deadline for financial institutions to get a hold of account holders' personal information passed last week, putting clients who have not provided the information at risk of having their accounts blocked. A National Bank of Ethiopia (NBE) directive issued last August commits commercial banks, microfinance institutions, and payment instrument issuers to include a tax identification number (TIN), average monthly income, and occupation under all client account information. The requirements also apply when opening new accounts. Banks and microfinance institutions had been given a six-month window to set up a Know Your Customer (KYC) unit at their headquarters, to update customer information and set up a system to monitor transactions deemed "suspicious." Over the past few months, banks have been contacting their clients by phone to gather details and create a comprehensive customer database, though it remains to be seen how much data they have compiled. Last October, the central bank issued a circular that introduced adjustments to the directive. It allows banks to accommodate and include low-income and undocumented nationals who do not possess identification documents, instead using biometric data (photographs and fingerprints).