CBN Imposes Daily Limit on PoS Transactions to Boost Cashless Economy
The Central Bank of Nigeria (CBN) has introduced a new policy limiting Point of Sales (PoS) agents to a daily transaction cap of N1.2 million. This move, detailed in the CBN’s ‘Circular on Cash-Out Limits for Agent Banking Transactions’ released on Tuesday, is part of a broader strategy to promote a cashless economy.
The circular, signed by Oladimeji Yisa Taiwo on behalf of the Director of the Payments System Management Department, outlines the need for policy changes to enhance the use of electronic payment channels in agency banking. The Nigerian Financial Services Report has highlighted that agency banking, which includes PoS and mobile money, plays a crucial role in providing financial services to the unbanked population, significantly contributing to financial inclusion.
As of July 2024, Nigeria recorded 3.05 million deployed PoS and 4.06 million registered PoS terminals, according to the Nigeria Interbank Settlement System Plc. The CBN’s new policy also establishes a cash withdrawal limit of N500,000 per customer per week, with each agent’s daily cash-out limit capped at N1.2 million. Additionally, single customer transactions via agent terminals are now restricted to a maximum of N100,000 per day.
Agents are required to connect their terminals to a Payment Terminal Service Aggregator (PTSA). The CBN mandates that daily transaction data, including withdrawals, transaction limits, and account balances, be electronically reported to the Nigeria Interbank Settlement System (NIBSS) using a standardized template provided to principals.
Furthermore, the CBN has clarified that agent banking services must be distinct from merchant activities, requiring agents to use the designated Agent Code 6010 for their operations.
A recent Bloomberg report highlighted how PoS agents have effectively filled the service gap left by Automated Teller Machines (ATMs), with over two million mobile agents managing daily transactions across the country. According to the International Monetary Fund, the proliferation of fintech companies like Opay, Paga, and Moniepoint has resulted in about 1,600 agents per square kilometer in Nigeria.
Despite these advancements, the CBN continues to enforce regulations to maintain control over the financial ecosystem. In a circular dated December 3, the CBN warned banks of potential sanctions if they fail to adequately supply their ATMs, underscoring the ongoing efforts to enhance the efficiency and reach of financial services across the nation.
