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CBN warns banks, payment service providers others against discrimination of payment cards

The Central Bank of Nigeria (CBN) has cautioned banks, switching companies, and other relevant parties in the Nigerian payment system against discrimination between payment cards issued by Nigerian banks.

The warning is contained in a circular signed by the CBN’s Director, Payments System Management Department, Musa Jimoh, and issued to all banks, switching companies, and others.

This is coming at a time the apex bank has intensified its drive toward achieving a cashless economy with its new policy on over-the-counter cash withdrawal limits for individuals and companies as well as withdrawal limits for Automatic Teller Machine (ATM) and Point of Sale (POS)

Jimoh said that the circular titled, ‘Re: Interoperability and Interconnectivity of the Payments System Infrastructure in Nigeria’, is a reminder of some of the provisions of its Guidelines on operations of electronic payment channels in Nigeria (June 2020).

POS terminals must accept all cards

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Jimoh noted that the merchant acquirers shall ensure that the purchased and deployed POS terminals shall accept all cards.

The circular reads, ‘’The Central Bank of Nigeria has observed that a number of the acceptance devices deployed by banks discriminate between payment cards. For the avoidance of doubt, all certified payment acceptance devices deployed in Nigeria are required to accept ALL transactions arising from any card issued by any Nigerian bank.

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‘’The circular serves as a reminder of the following provisions of the Guidelines on operations of electronic payment channels in Nigeria (June 2020);

  • Section; Merchant acquirers shall ensure that POS terminals purchased and deployed at merchant/retailers location through the CBN licensed Payment Terminal Services Provider shall accept all cards (card agnostic)
  • Section; To achieve interoperability, all POS terminals deployed in Nigeria shall accept all transactions arising from any card issued by any Nigerian bank. Accordingly, acquirers and other service providers shall be card neutral entities that have no reason to promote or favor any card brand over the other;
  • Section; Every acquirer must be able to accept all cards issued by Nigerian banks, whether through a direct license or via an arrangement with any other acquirer that is licensed under the relevant card/payment schemes.’

Jimoh also urged all the affected service providers to take note of the circular on interoperability and interconnectivity of the Payment Service Infrastructure in Nigeria.

He said, ‘’This serves as notice to all banks and acquirers to desist from the practice of discrimination, as observed breaches will attract appropriate regulatory sanctions.’’

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