Banks, fintech operators get additional time to meet new payment security requirements
The Central Bank of Nigeria (CBN) has extended the deadline for the enforcement of its Point of Sale (PoS) terminal geo-fencing framework to July 31, 2026, in a move aimed at giving financial institutions and payment operators additional time to comply with the new regulatory requirements.
The apex bank disclosed the development in a circular issued by the Director of the Payments System Supervision Department, Rakiya Yusur.
The extension forms part of the CBN’s ongoing efforts to strengthen the security and integrity of Nigeria’s digital payment ecosystem while tackling the growing use of PoS terminals for fraudulent and criminal activities across the country.
Under the directive, all PoS terminals operating in Nigeria are required to be geo-tagged, enabling them to function strictly within approved and registered locations linked to merchants and agents.
The measure is expected to assist regulators and security agencies in monitoring payment activities and tracking operators who deploy PoS terminals for illegal transactions, fraud, kidnapping payments, robbery and other financial crimes.
The CBN had earlier directed all stakeholders within Nigeria’s payment ecosystem, including Deposit Money Banks (DMBs), Microfinance Banks (MFBs), Mobile Money Operators (MMOs), Super Agents and switching companies, to migrate to the ISO 20022 messaging standard and implement mandatory geo-tagging of payment terminals.
ISO 20022 is an international financial messaging standard designed to improve payment processing, transaction monitoring and interoperability across payment systems.
According to the circular, the apex bank also approved an adjustment to the geo-fence operational radius for PoS terminals.
“Further to the Circular with reference number PSS/DIR/PUB/CIR/001/001 dated August 25, 2025, on migration to ISO 20022 standards for payments messaging, mandatory geo-tagging of payment terminals, and various stakeholders’ engagement on the subject to address the operationalization of the Circular, the Central Bank of Nigeria has considered and approved the following,” the circular stated.
It added, “Geo-fence radius is hereby increased from 10 metres to 70 metres. Enforcement of PoS Terminal Geo-fence is extended to August 1, 2026.”
The extension means operators now have until July 31, 2026, to complete all technical integrations, operational adjustments and compliance procedures before enforcement begins on August 1.
The CBN further directed all financial institutions and payment service operators to submit evidence of compliance to the Payments System Supervision Department within the stipulated timeline.
“Evidence of compliance with the above should be addressed to the Director, Payments System Supervision Department via paymentdata@cbn.gov.ng not later than 31 July, 2026,” the circular added.
The apex bank also instructed financial institutions to resolve all pending operational challenges with the National Central Switch to facilitate seamless compliance with the directive.
“Financial institutions are required to resolve all operational issues with the National Central Switch within the stipulated timeline to ease compliance,” it stated.
Industry stakeholders believe the latest extension will provide relief for operators who have been struggling with infrastructure deployment, terminal configuration and integration issues associated with the geo-fencing framework.
Many payment operators had reportedly expressed concerns over the initial compliance timeline, citing technical difficulties and the need for additional coordination among banks, fintech companies and switching platforms.
The geo-fencing initiative is part of broader reforms introduced by the CBN to sanitize the digital payment space and reduce financial crimes linked to the rapid growth of PoS transactions in Nigeria.
In recent years, PoS terminals have become one of the most widely used payment channels in the country, especially in rural and underserved communities where access to traditional banking infrastructure remains limited.
However, security agencies have repeatedly raised concerns over the misuse of PoS terminals by criminal syndicates for money laundering, identity theft, fraud and ransom collection.
By restricting terminals to approved locations, the CBN believes suspicious transactions and illegal movements of terminals can be more easily detected and investigated.
Analysts say the implementation of geo-tagging technology could significantly improve transaction traceability and strengthen consumer confidence in Nigeria’s electronic payment system.
The development also underscores the CBN’s increasing focus on financial technology regulation and payment security as digital transactions continue to expand across the country.
