The Central Bank of Nigeria (CBN) has announced a further extension of the compliance deadline for mandatory geo-fencing of Point-of-Sale (PoS) terminals, moving the new deadline to August 1, 2026. This decision follows consultations with industry stakeholders to address operational challenges encountered during the rollout of the policy.
Key Changes in the Policy
In a circular signed by Rakiya Mohammed, Director of the Payments System Supervision Department, the CBN also increased the permitted geo-fence radius for PoS machines from 10 metres to 70 metres. This represents a 600% increase, aimed at providing operators with greater flexibility while enhancing transaction traceability and reducing fraud risks.
Objectives of Geo-Fencing
The geo-fencing initiative is designed to reinforce regulatory oversight of Nigeria's rapidly expanding digital payment system. By restricting PoS terminals to operate only within designated locations, the CBN aims to improve monitoring, reduce financial crimes such as fraud and identity theft, and align with global payment standards.
Compliance Requirements
All financial institutions, including commercial banks, microfinance banks, and mobile money operators, must submit evidence of compliance to the Payments System Supervision Department by July 31, 2026. Additionally, geo-tagging of all payment terminals is now mandatory to improve data accuracy and transparency.
Industry Context
The extension highlights the operational complexities faced by banks and fintech firms as Nigeria accelerates efforts to modernise payment infrastructure. The CBN had previously mandated migration to the ISO 20022 payment messaging standard by October 31, 2025, underscoring the push for a more secure and standardised financial system.
Background on PoS Operators
Earlier, the Association of Point of Sale Service Providers threatened to suspend services nationwide unless the CBN and the Federal Competition and Consumer Protection Commission intervened in alleged exclusivity practices by two companies. The association cited violations of regulatory laws in their operations.
This development underscores the CBN's commitment to enhancing the security and efficiency of Nigeria's payment ecosystem while addressing industry concerns.
