By Ebiere Kekeboro
The Central Bank of Nigeria (CBN) has assured that the implementation of its new regulations on Point of Sale (PoS) terminals and payment systems will boost efficiency, enhance security, and safeguard Nigeria’s fast-growing electronic payment ecosystem.
According to the apex bank, convenience and security remain vital to sustaining public trust in the financial system. The new measures, which mandate geo-tagging of PoS machines and migration to the ISO 20022 global payment messaging standard, are designed to tighten oversight, improve consumer protection, and align Nigeria’s e-payment space with international best practices.
CBN Governor Olayemi Cardoso explained that the reforms reflect the bank’s longstanding commitment to digital innovation and financial inclusion. He said Nigeria has been at the forefront of fintech growth in Africa, with innovations that predated similar moves in advanced economies.
“Many innovations that other countries are only now experiencing have been part of our system for years. We must celebrate these successes, as they contribute to building our global reputation,” Cardoso said.
He added that despite global economic headwinds, Nigerian fintech companies continue to thrive, attracting significant foreign investment and producing several unicorns this year alone. Their innovations, he noted, have expanded access to finance, reduced transaction costs, and brought more people into the formal financial system.
However, Cardoso warned against fraud and misuse of digital channels. He urged financial institutions and fintech firms to strengthen Know Your Customer (KYC) processes, tighten transaction monitoring, and protect vulnerable populations. “Trust is built on transparency and accountability. As regulators, we will maintain a zero-tolerance approach to compliance violations,” he stressed.
The CBN’s new directive, contained in a circular signed by Rakiya Yusuf, Director of Payments System Supervision Department, mandates that all PoS devices must have native geo-location services enabled. They must be equipped with double-frequency GPS receivers to provide reliable coordinates of merchants’ business locations.
Under the rules:
Geo-tagging is mandatory: Every PoS device must capture and transmit its exact location at the start of a transaction. Any activity outside a 10-metre radius of the registered business address will be flagged.
Strict timelines: Existing PoS machines must be geo-tagged within 60 days, while new devices must be tagged before certification and activation.
ISO 20022 compliance: Payment operators must migrate to the new messaging standard by October 31, 2025. This global framework, developed by SWIFT, creates a single standard for secure domestic and cross-border transactions.
Central oversight: All payment terminals must be registered with licensed Payment Terminal Service Aggregators (PTSA), such as NIBSS or Unified Payment Services Limited. Terminals not routed through PTSA will be barred from processing transactions.
The CBN emphasized that Android version 10 or higher will be required on all PoS devices to integrate with the National Central Switch, which will monitor geolocation and enforce compliance.
The reforms come as PoS agents play a central role in Nigeria’s cash economy. With banks cutting branch networks and ATMs frequently running dry, PoS kiosks have become critical for millions of Nigerians.
According to the Nigeria Interbank Settlement System (NIBSS), as of March 2025 there were 8.36 million registered PoS terminals, with 5.90 million active. Transactions in the first quarter of 2025 surged to ₦10.51 trillion, a 301.67 percent rise from Q1 2024.
But the rapid growth has also exposed consumers to fraud and abuse, leading to a surge in complaints. To address these challenges, the CBN launched the Unified Complaints Tracking System (UCTS) and a verification code (*959#) to help customers confirm licensed financial institutions and resolve disputes transparently.
PoS aggregators and industry stakeholders welcomed the regulations but noted challenges. Tinuke Adebola, a Lagos-based aggregator, argued that PoS machines have effectively replaced ATMs. “Banks are not ready to absorb the rising costs of maintaining ATMs that require power, cash handling, and security. PoS is filling the gap,” she said.
Another operator, Oloye Adigun, stressed the importance of network quality and affordability of devices. He said services such as bills payment, transfers, and third-party receipts have made PoS terminals indispensable.
Consumer advocates also highlighted the shift in banking culture. “Brick-and-mortar banking is giving way to digital solutions that are faster and cheaper,” said Uju Ogubunka, President of the Bank Customers Association of Nigeria. “Consumers now demand simple, technology-driven solutions to meet daily needs.”
For Cardoso, the reforms are not only about fraud prevention but also about inclusion. He reiterated the CBN’s goal of ensuring 80 percent of Nigerian adults are financially included by 2026 through agent banking, fintech partnerships, and targeted support for women and rural communities.
“The journey ahead demands trust. Together, we must build a market based on transparency, accountability, and innovation. Nigeria’s e-payment ecosystem has proven resilient, and with these measures, it will only become stronger,” the CBN governor said.