The Central Bank of Nigeria (CBN) has introduced new guidelines that set limits on contactless payments, as revealed in circulars issued on Tuesday. The guidelines, aimed at standardizing operations in the payments system and promoting innovation while maintaining financial system stability, require banks, financial institutions, and payments service providers to adhere strictly to the regulations.
According to the CBN, contactless payments involve conducting financial transactions without physical contact between the payer and acquiring devices, offering a safe and efficient method for low-value and high-volume payments. The guidelines were designed to ensure that participants in contactless payments adopt appropriate risk management processes and adhere to relevant standards.
The first circular outlines the guidelines for banks, financial institutions, and payments service providers, emphasizing the need for compliance. In the second circular, the CBN specifies that contactless payments through accounts or wallets in Nigeria are subject to a transaction limit of N15,000, with a daily cumulative limit of N50,000.
The CBN states that transactions exceeding the daily limit will require verification and authorization. Higher-value contactless payments, which surpass the specified limits, will require additional verification and authorization, following the existing Know Your Customer (KYC) requirements and limits on electronic payment channels. Transactions above the stipulated daily cumulative limit will need to be conducted using contact-based technology.
These measures aim to strike a balance between enabling convenient contactless payments and ensuring necessary security measures are in place to safeguard financial transactions.
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