CBN gives PoS operators one month to use aggregators
The Central Bank of Nigeria has made it mandatory for all POS operators to process transactions through licensed payment terminal service aggregators. A circular posted on the CBN website on Thursday said the measure is aimed at improving tracking and management of electronic transactions in the country. “As part of efforts to address concerns over processing all POS transactions through a single aggregator, the CBN granted the second PTSA license to Unified Payment Services Limited on April 19, 2024.
“In support of the above, the CBN issues the following instructions: 1. From now on, acquirers will be required to process all transactions from merchants’ and agents’ PoS terminals, whether physical or electronic PoS terminals, through CBN-authorized payment terminal service aggregators. 2. The PTSAs may only transmit PoS transactions to processors accredited by the relevant payment system, designated by the acquirer and licensed by the CBN,” the central bank said. He noted that the Nigerian Interbank Payments System Limited obtained a PTSA licence for aggregating PoS transactions in 2011.
However, to address concerns over routing all transactions through aggregators, the CBN issued a second PTSA licence to Unified Payment Services Limited in April this year. “In August 2011, to achieve its objective of tracking electronic transactions in Nigeria, the Central Bank of Nigeria granted a license to the Nigerian Interbank Payment System Plc as a payment terminal services aggregator. As part of efforts to address concerns over all POS transactions being conducted through a single aggregator, the CBN issued a second PTSA license to Unified Payment Services Limited on April 19, 2024.” The CBN directed that all acquirers (institutions responsible for processing payments from PoS terminals) must process transactions through one of the two licensed aggregators.
Furthermore, licensed processors must be integrated into both PTSAs to allow acquirers flexibility in choosing their preferred service provider. Payment terminal service providers responsible for deploying and managing PoS terminals should note that they must ensure that their devices and applications are configured to work with each PTSA selected by the acquirer. According to the CBN, PTSPs will also be required to submit monthly reports to the CBN detailing the number of dealers and agents they manage and the PTSA services they have availed.
Similarly, the CBN required each PTSA to submit a monthly report on all transactions processed through their platform. The report must be submitted to the Director-General of Payment Systems Management within seven days of the end of the month, according to the central bank. The CBN urged all payment service providers to regulate their business relationships with the PTSA within 30 days, warning that failure to comply with the directive will result in appropriate sanctions.
