The Central Bank of Nigeria (CBN) has introduced sweeping new regulations designed to prevent any single bank or fintech company from dominating the country's rapidly growing Point-of-Sale (PoS) and digital payments ecosystem. This policy could reshape competition among major players, including OPay, Moniepoint, PalmPay, Paystack, Flutterwave, and traditional banks that have aggressively expanded their presence in consumer and merchant payments.
CBN Sets Strict Market Share Limits
In a circular released on Monday, June 15, 2026, the apex bank announced that any licensed financial institution controlling more than 25% of the consumer-issuing market will be restricted to a maximum of 15% market share in merchant-acquiring activities. Similarly, firms with dominant positions in merchant acquiring will be barred from holding excessive influence in consumer payment services, according to a report by TechCabal.
The CBN stated that the move aims to reduce concentration risk and prevent any operator from becoming the single gateway for Nigeria's cashless economy. The new restrictions will take effect from December 31, 2026.
What the New Rule Means
Consumer issuing covers products and services used by customers to make payments, including bank accounts, debit cards, digital wallets, and other payment instruments. Merchant acquiring refers to the infrastructure that enables businesses to receive payments, including PoS terminals, payment gateways, and merchant settlement systems.
These restrictions are expected to have a major impact on fintech firms that have rapidly expanded from merchant services into digital banking and consumer finance.
OPay, Moniepoint, Flutterwave and Others Face Scrutiny
The policy is expected to affect major fintech operators such as OPay, Moniepoint, PalmPay, Paystack, and Flutterwave, many of which have spent years building extensive merchant-payment networks while simultaneously expanding into customer-facing banking services. In recent months, competition has intensified. Paystack acquired Ladder Microfinance Bank, while Flutterwave secured a microfinance bank licence after acquiring open banking startup Mono, signaling a broader push by fintech firms to transform payment users into full-scale banking customers.
Traditional banks are also unlikely to escape the new restrictions. Large lenders seeking to dominate merchant acquiring while maintaining strong positions in retail banking may face similar limitations.
CBN Targets Market Concentration
The apex bank explained that the new framework was introduced to address growing concerns over market concentration, operational dependence, and the emergence of dominant operators across critical payment channels. The restrictions will not apply only to individual companies; groups of related entities operating under common ownership or control will also be assessed together, preventing firms from bypassing the rules through subsidiaries.
To ensure compliance, all regulated institutions will now be required to submit monthly market-share reports based on CBN-approved templates.
Broader Reforms Underway
Beyond market-share restrictions, the CBN is introducing stricter disclosure requirements on beneficial ownership and encouraging banks and fintech firms to host critical payment infrastructure on local cloud systems. These reforms signal the regulator's determination to build a more competitive, secure, and balanced payments ecosystem as Nigeria's digital payments industry, which processed more than ₦1.2 quadrillion in transactions in 2025, continues its rapid expansion.
The CBN warned that institutions that violate the new rules could face supervisory sanctions in line with existing laws, regulations, and guidelines.
Fintech Giants Face Tougher Rules
Legit.ng earlier reported that Nigeria's financial sector is witnessing one of its fiercest competitive battles yet as traditional banks and fintech startups fight for dominance in the country's booming digital payments market. Tier-1 lenders, once criticized for slow apps, failed transfers, and unreliable digital infrastructure, are mounting a powerful comeback after years of losing customers to fast-growing fintech companies such as OPay, PalmPay, and Moniepoint.
The latest numbers underline the scale of the battle. Nigeria's leading banks processed a combined N286.19 trillion in mobile transactions, reflecting a dramatic rise in digital banking adoption and signaling that traditional lenders are regaining ground in a market once thought to belong to fintech disruptors.
