The directive, issued in a circular dated December 18 and signed by Rita Sike, Director of the Financial Policy and Regulation Department, requires financial institutions to implement multi-factor authentication for foreign card transactions exceeding $200 per day, $500 per week, or $1,000 per month. Banks are also instructed to configure automated teller machines (ATMs), point-of-sale (POS) terminals, and virtual payment platforms to accept international cards, in full compliance with card association standards.
According to the CBN, the measures aim to safeguard uninterrupted local currency withdrawals, payments, and fund transfers for users of foreign-issued payment cards, including tourists and Nigerians in the diaspora visiting the country. The apex bank emphasized that the initiative is designed not only to enhance security but also to improve the overall user experience.
Strengthening Payment Systems and Fraud Controls
Under the new guidelines, banks and non-bank acquirers must ensure that ATMs and POS terminals are properly equipped for international card usage, maintain adequate liquidity to settle transactions in naira, and clearly communicate exchange rates and associated fees to customers prior to completing transactions.
The CBN further instructed financial institutions to implement robust transaction monitoring systems capable of detecting unusual patterns in foreign card usage. Enhanced know-your-customer (KYC) and anti-money laundering (AML) protocols are also required for merchants handling such transactions. Any suspicious activity must be promptly reported to the Nigeria Financial Intelligence Unit (NFIU).
Banks and acquirers are also expected to recalibrate fraud-monitoring systems to minimize false declines, offer contactless payment options for low-value transactions, and resolve consumer complaints within stipulated timelines. Failure to comply could lead to sanctions by the apex bank.
In addition, institutions must maintain auditable chargeback and dispute resolution processes in line with CBN guidelines, including retaining transaction documentation for at least 12 months and providing quarterly merchant training on dispute handling.
The CBN advised tourists and returning Nigerians experiencing challenges using foreign cards to report incidents to its consumer protection department via complaint4cbn@cbn.gov.ng. The apex bank confirmed it will closely monitor compliance and take action against institutions that fail to adhere to the directive.