CBN orders banks to configure ATMs, POS for foreign card transactions

The Central Bank of Nigeria has directed banks and non-bank acquirers to take steps that will guarantee smooth and uninterrupted transactions for users of foreign-issued payment cards across the country.

In a circular issued to industry operators, the apex bank said all automated teller machines, point-of-sale terminals and virtual terminals in Nigeria must be properly configured to accept international cards routed through Nigerian acquirers.

The CBN also instructed operators to comply fully with the standards set by card associations and to obtain all required certifications needed for seamless transaction processing.

According to the bank, the move is aimed at improving efficiency, reducing transaction failures and ensuring a better payment experience for card users, especially visitors and businesses that rely on foreign-issued cards.

The directive was contained in a circular signed by the Director of the Financial Policy and Regulation Department, Dr Rita Sike.

CBN, among other things, also asked banks and non-bank acquirers to create multi-factor authentication for foreign card transactions exceeding $200 per day.

Furthermore, the regulator directed banks to implement the same authentication measures for transactions above $500 per week and $1,000 per month.

“In this regard, banks and non-bank acquirers shall: implement multi-factor authentication for all withdrawals and online transactions exceeding $200 per day, $500 per week, and $1,000 per month (or its equivalent),” the circular reads.

“With respect to ATM cash withdrawal transactions, ensure compliance with approved cash withdrawal limits.

“Clearly communicate the applicable exchange rate, which shall be market-driven and based on the prevailing official rate, as well as other associated charges to users.

“Transactions should only be completed after the user has accepted the terms (with evidence obtained).

“Maintain sufficient liquidity position to settle transactions. Settle transactions for the merchant in local currency (naira).

“Implement transaction monitoring to detect unusual patterns in the use of foreign cards across all terminals.

“Strengthen know-your-customer and anti-money laundering controls for merchants handling foreign card payments.

“Require their merchants to ensure that all their copies of card-present transaction receipts are properly signed and to request for valid identity documents where a transaction appears suspicious.”

The circular also noted that card acceptance devices must be equipped with contactless payment options for low-value transactions and that consumer complaints must be resolved within approved timelines.

“Furthermore, acquirers shall implement and maintain robust, auditable chargeback management processes aligned with applicable card-scheme rules and CBN guidelines (including but not limited to timely case intake, evidence collation, refund execution, and post-incident analytics),” the statement said.

“Require, verify, and retain documentation (including terminal approval slip and signed merchant receipt, and item/service description) for card transactions for use in dispute resolution and chargebacks.

“The records shall be retained for a minimum of 12 months and be readily retrievable within 24 hours of request by the Acquirer or Scheme.

“Provide quarterly training to their merchants and agent networks on dispute handling and chargeback processes.”

CBN directed banks and non-bank acquirers to report suspicious transactions to the Nigeria Financial Intelligence Unit (NFIU) and recalibrate fraud-monitoring systems to reduce false declines on legitimate transactions.

The regulator urged tourists and Nigerian returnees experiencing challenges using foreign-issued cards to report such incidents to the CBN’s Consumer Protection Department via [email protected].

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