Bank Verification Number and Fraud Prevention and Detection in Nigerian Banks

Abstract

This study examines the roles of the Bank Verification Number (BVN) in detecting and preventing fraudulent activities in the Nigerian banking sector. The specific objectives are to assess the effectiveness of BVN in fraud detection and prevention and identify challenges facing its implementation. Descriptive and regression analyses were conducted using data from respondents in the Nigerian banking sector. The R-squared value of 0.613 infers that all the identified factors account for 61.3% of the variation in BVN’s ability to prevent fraud in Nigerian banks, while the F-statistic diagnosing the fitness of the model shows that all t.he independent variables are statistically significant (F=55.203) for the model this implied that the majority of respondents view BVN as an effective tool in preventing and detecting fraud. Bank-related factors such as average customer size, total deposit, and staff strength significantly influence BVN’s efficacy in fraud prevention. However, The R-squared value of 0.517 infers that all the identified factors account for 51.7% of the variation in challenges facing implementation of BVN in Nigerian banking industry, while the F-statistic diagnosing the fitness of the model shows that all the independent variables are statistically significant (F=37.268) for the model this implied that challenges such as lack of cooperation among financial institutions and poor regulatory performance hinder BVN implementation. Therefore, study recommended that include strengthening BVN implementation, addressing challenges, conducting awareness programs, and continuously monitoring bank-related factors to enhance fraud prevention measures. Collaboration and further research are also recommended to improve BVN’s effectiveness in fraud prevention.