CBN Mandates Multi-Factor Authentication for Foreign Card Transactions Across Nigeria
The Central Bank of Nigeria (CBN) has ordered banks and non-bank acquirers to strengthen security on foreign-issued card transactions across the country. According to a circular dated December 18, financial institutions must now implement multi-factor authentication for transactions exceeding $200 daily, $500 weekly, and $1,000 monthly. The directive, signed by Rita Sike, director of the financial policy and regulation department, also requires point-of-sale (POS) terminals to be properly configured for foreign card usage.
This move is aimed at ensuring smooth and efficient access to local currency withdrawals, payments, and transfers for users of international cards in Nigeria. The CBN emphasized that the initiative will not only enhance transaction security but also improve user experience for both tourists and Nigerians in the diaspora visiting the country.
Under the new guidelines, all automated teller machines (ATMs), POS terminals, and virtual terminals must be capable of accepting international cards through Nigerian acquirers. Banks are expected to comply with card association standards, obtain necessary certifications, and maintain continuous system availability to avoid transaction disruptions. Clear communication of exchange rates, transaction charges, and approval of user consent is also mandatory.
Financial institutions are further tasked with strengthening anti-money laundering controls, monitoring unusual transaction patterns, and ensuring merchants properly manage card-present receipts and verify customer identities. They must also report suspicious transactions to the Nigeria Financial Intelligence Unit (NFIU) and maintain robust dispute resolution and chargeback processes to prevent wrongful declines of genuine transactions.
The CBN has advised that unresolved complaints from tourists or returning Nigerians regarding foreign card usage be reported via complaint4cbn@cbn.gov.ng. Institutions failing to comply with the directive face sanctions, highlighting the apex bank’s commitment to protecting consumers while promoting secure and seamless foreign card transactions across Nigeria.
source: Leadership