The Central Bank of Nigeria (CBN) has rolled out fresh directives that will significantly change how Point of Sale (PoS) terminals operate across the country.
The new rules, targeted at banks, fintech firms, and licensed payment service providers such as OPay, Moniepoint, PalmPay, and Kuda, are aimed at strengthening security around electronic transactions and curbing fraud.
GPS tracking now mandatory
In a circular issued on August 25 by the apex bank’s Department of Payments System Supervision, operators were ordered to ensure that all PoS terminals come with geo-location capabilities.
According to the CBN, each device must be fitted with double-frequency GPS receivers to allow for accurate tracking of merchants and agents during transactions.
The directive also makes it compulsory for payment operators to register every PoS machine with a Payment Terminal Service Aggregator (PTSA), while capturing and reporting the exact coordinates of business locations.
Existing PoS machines must be geo-tagged within 60 days, while new ones must meet this requirement before they are certified and activated.
Tackling fraud and insecurity
PoS terminals have become a lifeline in Nigeria’s cash-driven economy, especially as bank branches and ATMs struggle to meet demand. However, the rapid growth of agent banking has also fueled cases of fraud, with reports linking PoS outlets to money laundering and ransom collection by criminal groups.
By mandating GPS-enabled devices, the CBN hopes to tighten oversight, track irregular transactions, and reduce the use of PoS machines for illicit purposes.
CBN’s new reporting standards
Beyond location tracking, the CBN has also directed operators to upgrade their systems to adopt ISO 20022, a global standard for financial messaging developed by SWIFT. From October 31, 2025, all transaction messages, whether domestic or international, must comply with this format.
This means that payer and payee identifiers, merchant/agent details, and other key transaction data will have to be reported in a more structured and transparent way. The CBN believes the new standard will improve data quality, strengthen fraud detection, and enhance the security of Nigeria’s payment ecosystem.
Additionally, the regulator noted that all PoS machines must run on Android 10 or higher to ensure smooth integration with the National Central Switch, which will oversee geolocation monitoring and geofencing.
Why this is important
Nigeria has seen explosive growth in PoS transactions in recent years. Data from the Nigeria Inter-Bank Settlement System (NIBSS) shows that PoS payments in 2024 jumped nearly 70% from the previous year, reflecting the rising reliance on fintech-driven banking alternatives.
But with this growth has come heightened risks, making the CBN’s intervention critical. For fintechs like OPay, Moniepoint, PalmPay, and Kuda, the directive means an urgent push to upgrade their technology and ensure full compliance ahead of the deadline.