The Central Bank of Nigeria (CBN) has issued a directive mandating all Payment Service Providers (PSPs) to route transactions from Point of Sale (PoS) terminals, whether physical or electronic, through a CBN-approved Payment Terminal Service Aggregator (PTSA).
In a circular signed by Oladimeji Yisa Taiwo from the CBN’s Payments System Management Department, the apex bank has given a 30-day deadline for service providers to comply with the new routing guidelines.
This measure aims to enhance the monitoring of electronic transactions across Nigeria and address concerns about the centralization of PoS transactions.
The circular stated, “To achieve the objective of tracking electronic transactions in Nigeria, the Central Bank of Nigeria granted a Payment Terminal Service Aggregator license to Nigeria Interbank Settlement System Plc in August 2011.
Consequently, the CBN directs acquirers to route all transactions from PoS terminals at merchant and agent locations, whether physical or electronic, through any CBN-licensed PTSA.”
It further specified that PTSA providers must route PoS transactions only to processors certified by the relevant Payment Scheme, nominated by the Acquirer, and licensed by the CBN.
This directive follows the recent expiration of the deadline for PoS agents to register their businesses with the Corporate Affairs Commission (CAC).
The CAC has begun taking action against non-compliant PoS businesses, including closures.
The move comes in response to increasing fraud incidents involving PoS terminals and the CBN’s broader efforts to regulate cryptocurrency and virtual currency transactions.
According to Nigeria Inter-Bank Settlement System Plc, PoS terminals were linked to 26.37% of fraud incidents in 2023.
