CBN directs banks to configure ATMs, PoS terminals for foreign card transactions

*The Central Bank of Nigeria explains the aim is to ensure uninterrupted and efficient transactions for consumers of foreign-issued payment cards across the country’s financial space

Isola Moses | ConsumerConnect

The Central Bank of Nigeria (CBN) has directed commercial banks and non-bank acquirers to configure all Automated Teller Machines (ATMs), Point of Sale (PoS) and virtual terminals to accept international cards with Nigerian acquirers.

The CBN said the overarching objective of this development is to comply fully with card association standards, and possess the necessary certifications to enable seamless transaction processing in the financial ecosystem.

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The Bank also noted the aim is to ensure uninterrupted and efficient transactions for consumers of foreign-issued payment cards across Nigeria.

Dr. Rita Sike, Director of Financial Policy and Regulation Department at CBN, disclosed this development in a circular to industry stakeholders.

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

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

The Bankers’ Bank stated: “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).

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

The circular also noted: “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).”

The CBN said: “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.”

It noted: “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.”

According to the circular, card acceptance devices must be equipped with contactless payment options for low-value transactions and that consumer complaints must be resolved within approved timelines.

It said: “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).

“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 CBN stated: “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.”

The Bank as well 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 banking industry regulator as well urged tourists and Nigerian returnees experiencing challenges using foreign-issued cards to report such incidents to the CBN’s Consumer Protection Department via complaint4cbn@cbn.gov.ng.

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