Illegal Electronic Transactions: CBN Issues New Directive To PSPs

Possibly as a way of tracking illegal electronic transactions, the Central Bank of Nigeria (CBN) has directed all Payment Service Providers (PSPs) to connect to Payment Terminal Service Aggregators.

The Eagle reports that law enforcement agencies have had a busy day trying to contain criminals using electronic platforms to perpetrate their illegal acts, and the latest directive is seen as an effort at containing them.

It was issued by the CBN through a circular with reference number: PSM/DIR/CON/CWO/051/117 and dated September 11, 2024.

The Director of Payment Services Management Department,, Mr. Oladimeji Taiwo, who signed the directive said it was informed by the need to make PoS transactions more transparent and flexible, and in line with extant rules.

The CBN wants all PTSPs to submit monthly returns, which should document for easy reference, the number of merchants and agents they manage.

They are also to shoe the PTSA services used to route the corresponding transactions.

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“In order to achieve the objective of tracking electronic transactions in Nigeria, the Central Bank of Nigeria (CBN) in August 2011, granted a Payment Terminal Service Aggregator (PTSA) licence to Nigeria Interbank Settlement System PIc (NIBSS),

As part of efforts to mitigate the concerns regarding channeling all Point of Sale (PoS) transactions through a single aggregator, the CBN on April 19, 2024, granted a second PTSA licence to Unified Payment Services Limited (UPSL.

“In furtherance of the above, the CBN hereby directs as follows:

“Acquirers are henceforth required to route all transactions from Pos terminals at merchant and agent locations,

“Whether on physical or electronic POS terminals, through any CBN-licensed Payment Terminal Service Aggregator (PTSA).,

In addition, each PTSA is required to submit monthly returns to the CBN, detailing all transactions processed through their platforms, with the two submission to be made not later than seven days after the end of each month.

The apex bank warned that non-compliance would attract sanctions against any player that breaches the directives.

It is hoped that the latest directive would help the bank helm in those behind illegal electronic transactions.