The Association of Point of Sale Service Providers has issued a strong warning that banking and payment operations across Nigeria could be disrupted if regulators fail to urgently address what it describes as unfair exclusivity practices by two unnamed companies operating within the country’s payment ecosystem.
In a statement attributed to Yomi Idowu, Communications Consultant to the Association, the group said it had already formally protested what it called “persistent unlawful decisions” that, according to them, contravene existing financial and competition regulations.
The Association argued that the alleged actions violate both the rules of the Central Bank of Nigeria and provisions of the Federal Competition and Consumer Protection Act (FCCPA), 2018. It maintained that the situation, if left unresolved, could force a drastic industry response capable of affecting nationwide transactions.
Representing a coalition of Central Bank of Nigeria-licensed payment acceptors, acquirers, processors, and switches, the Association warned that it may be left with no choice but to take coordinated action targeting specific card operations.
As contained in the statement, the group declared: “As representatives of coalition comprising several Central Bank of Nigeria Licenced payment acceptors/acquirers, processors and switches they would have no option than to suspend acceptance/acquiring, processing and switching of Verve Card transactions.”
The Association further stressed that the alleged conduct of the companies involved is already damaging the broader financial technology environment, insisting that it weakens institutions and undermines regulatory compliance.
It added: “This decision has become unavoidable due to the persistent and escalating unlawful conduct of the companies which according to the Association jointly undermines ‘The integrity of Nigeria’s payments ecosystem, erodes the capital base of participating Institutions and violates several regulatory requirements.”
Among the specific concerns raised, the Association listed what it described as several regulatory breaches. These include allegations of monopoly practices and abuse of dominant market position in the domestic card scheme sector.
It outlined the issues as follows:
a) Maintenance of an exclusive monopoly over Verve transaction processing,
b) Abuse of dominant position in the domestic card scheme market, contrary to section 72 of the Federal Competition and Consumer Protection Act 2018 (FCCPCA) and Sections 3, 4, and 7.3 of the CBN Guidelines on Operation of Electronic Payment Channels,
c) Imposition of scheme fees beyond the regulated Merchant Service Commission (MSC) share allocated to acquirers under existing CBN rules, and
d) Unauthorized and unlawful debits from settlement accounts of acquirers, processors, and switches.
According to Idowu, the Association insists that the situation is particularly concerning because other card scheme operators have already aligned with regulatory expectations and removed similar restrictive practices.
Mr. Idowu concluded by noting: “Ironically the Association emphasized that other Card Scheme operators have since abolished all forms of exclusivity in compliance with CBN regulations”.