The Central Bank of Nigeria (CBN) has mandated all banks and non-bank acquirers of value to ensure uninterrupted and efficient local-currency withdrawal, payment, and transfer services for users of foreign-issued payment cards nationwide, as part of efforts to guarantee seamless use of foreign cards.
Under this directive, banks were also required to ensure that all ATMs, PoS, and virtual (web-based) terminals are configured to accept all international cards with Nigerian acquirers and to comply fully with card association standards.
The apex bank also ordered banks to 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).
It disclosed these in a circular addressed to all banks and other financial institutions on the seamless use of foreign cards.
The circular was signed by the Director, Financial Policy and Regulation Department, Dr. Rita Sike.
The apex bank said the directive was in furtherance of ongoing efforts to facilitate access to funds and enhance convenience, security, and the user experience for diasporans and tourists using foreign cards.
ATMs and PoS are required to hold appropriate certifications and, where needed, undergo recertification to ensure seamless processing of card transactions.
They must possess appropriate certifications and, where necessary, recertifications to ensure seamless processing of card transactions, the central bank added.
The CBN said banks must maintain system availability to ensure seamless, uninterrupted transaction processing.
With respect to ATM cash withdrawals, banks are required to ensure compliance with approved cash withdrawal limits.
The circular stressed that financial institutions must “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”, adding that “transactions should only be completed after the user has accepted the terms with evidence obtained”.
The apex bank also directed the banks to “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” and “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 further requested banks to “report suspicious transactions to the Nigeria Financial Intelligence Unit in line with extant regulations, recalibrate fraud-monitoring systems to minimise false declines on legitimate foreign card transactions, ensure that card acceptance devices are equipped with an option for contactless payments for low-value transactions.
“Resolve consumer complaints from these transactions within the approved timelines, as escalations to CBN will attract appropriate sanctions.”
The apex bank also directed that acquirers “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.”
With respect to ATM cash withdrawal transactions, the CBN directed that acquirers must ensure compliance with approved cash withdrawal limits and clearly communicate the applicable exchange rate, which shall be market-driven and based on the prevailing official rate, as well as any associated charges to users.
According to the CBN, transactions should be completed only after the user has accepted the terms and provided the required evidence.
The CBN also requires acquirers to maintain sufficient liquidity to settle transactions.
They (acquirers) are to “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.”
Acquirers are also directed to “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, report suspicious transactions to the Nigeria Financial Intelligence Unit in line with extant regulations, recalibrate fraud-monitoring systems to minimise false declines on legitimate foreign card transactions, ensure that card acceptance devices are equipped with option for contactless payments for low value transactions, resolve consumer complaints from these transactions within the approved timelines as escalations to CBN will attract appropriate sanctions.”
The CBN also stated that 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 collection, refund execution, and post-incident analytics.
James Emejo
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