KEY POINTS
- CBN mandates PoS transactions be routed through licensed service aggregators.
- Unified Payment Services Limited granted a PTSA license.
- Non-compliance will result in penalties for payment service providers.
The Central Bank of Nigeria (CBN) has recently enhanced its control over the use of electronic payment systems through reimbursement of Point of Sale (PoS) payments.
The latest rules demand that all PoS transactions, irrespective of being implemented physically or electronically, be channelled through licensed Payment Terminal Service Aggregators (PTSA). This step is one of the many strategies that the CBN has employed in ensuring that the Nigerian nation has enhanced transparency, and accountability, and generally increased and improved oversight of the nation’s financial transactions.
In an official circular to the Payment Service Providers (PSPs), Business Day reported that the CBN insisted that all acquirers must direct their transactions through any PTSA licensed with the bank. This directive is to help monitor and track the growing system of electronic payment in Nigeria.
Two licensed PTSAs to share responsibility
Initially, the CBN issued a PTSA license to the Nigeria Interbank Settlement System Plc (NIBSS) back in 2011.
However, bearing in mind the prospects of dependence on the licensed aggregator, the CBN granted a second license to Unified Payment Services Limited (UPSL) in April 2024. This way, the nation could be seen to be diversifying the payment terminal services.
Under the new measures, payment processors are required to connect with both licensed PTSAs. This allows the acquirers to make their choices based on the available services as required.
Monthly reports and compliance measures
To improve accountability, Payment Terminal Service Providers (PTSPs) are required to provide reports to the CBN monthly. These reports must contain the number of merchants and agents used, and the services that are being utilized.
Regarding these new rules, the CBN has provided a 30-day notice to all the affected firms. Payment service providers who have not regularized their operations will be penalized by this time.
