The Central Bank of Nigeria (CBN) has issued a significant mandate requiring all payment service providers (PSPs) to track Point of Sale (PoS) transactions, marking a pivotal shift in the nation’s financial transaction monitoring landscape.
In a circular released today and signed by Oladimeji Taiwo, Director of Payments System Management at the CBN, the central bank set a 30-day deadline for PSPs to align their operations with Payment Terminal Service Aggregators (PTSAs). This directive aims to centralize transaction routing and enhance the regulatory oversight of PoS transactions.
The CBN’s move is part of a broader strategy to improve transparency and operational efficiency in the payments ecosystem.
The April 19, 2024, issuance of a second PTSA license to Unified Payment Services Limited (UPSL) was an initial step towards this goal. Effective immediately, all PoS transactions, whether conducted at merchant or agent locations using physical or electronic terminals, must be routed through any CBN-licensed PTSA.
In addition, the new regulations stipulate that PTSAs can only forward transactions to processors that are certified by the relevant Payment Scheme, designated by the Acquirer, and licensed by the CBN.
This requirement aims to standardize and secure transaction processing, ensuring that all licensed processors are integrated with both PTSAs. This integration provides acquirers with the flexibility to select their preferred processors and PTSAs.
The CBN has also mandated Payment Terminal Service Providers (PTSPs) to configure their PoS devices and applications to direct transactions through the designated PTSA of the Acquirer.
Furthermore, PTSPs are required to submit monthly reports to the CBN, outlining the number of merchants and agents managed and detailing the PTSA services utilized.
Each PTSA must also provide monthly transaction reports to the CBN, with PTSP and PTSA returns due no later than seven days following the end of each month.
The CBN has called on all PSPs to comply with these new directives promptly and to notify the bank in writing within the stipulated 30-day period. The bank has warned that failure to adhere to these guidelines will result in appropriate sanctions.
