The Central Bank of Nigeria (CBN) has directed all payment service providers to route all Point of Sale (PoS) transactions through a Payment Terminal Service Aggregator that has been approved by the CBN, regardless of whether the PoS terminals are located at physical or virtual merchant and agent locations.
Additionally, CBN gave service providers a 30-day window within which to adhere to the updated routing specifications for Point of Sale transactions.
The central bank announced on Thursday that all point-of-sale (PoS) transactions from merchant and agent locations must henceforth be routed through any PTSA approved by the CBN. The circular was signed by Oladimeji Yisa Taiwo on behalf of the CBN’s Payments System Management Department.
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In order to allay worries about the centralization of these transactions under a single organization, this action attempts to improve the monitoring of electronic transactions throughout Nigeria and decentralize PoS transaction routing.
Nigeria Interbank Settlement System Plc was awarded a Payment Terminal Service Aggregator license by the Central Bank of Nigeria in August 2011 with the aim of tracking electronic transactions in the country. To support the aforementioned, the CBN hereby instructs acquirers to use any Payment Terminal Service Aggregator licensed by the CBN to handle all transactions from PoS terminals at merchant and agent locations, whether they are electronic or physical PoS terminals.
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The circular stated, “PTSAs are required to send PoS transactions to only processors licensed by the CBN, nominated by the Acquirer, and certified by the relevant Payment Scheme.”
This occurred subsequent to the deadline of September 5th, which was set for PoS agents to properly register their companies with the Corporate Affairs Commission.
Despite a legal challenge to the regulation, the CAC recently declared that it has started implementing severe measures, such as closing down PoS companies who neglected to register.
The CBN’s intentions to outlaw cryptocurrency and virtual currency trading, coupled with a number of fraud occurrences employing PoS terminals, are the reasons behind the directive on PoS business registration.
