5 Important Points PoS Operators Must Know About CBN Registration
The Central Bank of Nigeria (CBN) has introduced a daily withdrawal limit of N100,000 for Point-of-Sales (PoS) terminals. This move is part of efforts to support a cashless economy across the country.
According to the CBN, this policy aims to address operational issues, minimize fraud, and create consistent standards in the financial services sector.
The decision was first announced in a circular titled “Cash-out limits for agent banking transactions.” This circular was sent to all deposit money banks (DMBs), microfinance banks, mobile money operators, and super-agents.
Key Directives from the CBN Circular
1. Daily Transaction Limits for Customers
CBN has instructed that all PoS terminals used for agent banking must be configured to allow a maximum daily cash-out limit of N100,000 per customer.
2. Cumulative Daily Cash-Out Limit for Agents
Each agent has a maximum cumulative daily cash-out limit of N1,200,000, ensuring tighter control over cash flow within the system.
3. Separation of Agent Banking from Merchant Activities
Agent banking services must remain distinct from regular merchant activities. To maintain this separation, agents are required to use the approved Agent Code 6010 for all agent banking transactions.
4. Penalties for Non-Compliance
CBN has emphasized that any agent or operator who violates these guidelines will face strict penalties. These penalties could include monetary fines or administrative sanctions, depending on the severity of the violation.
Why the N100,000 Limit Matters
The implementation of this policy has raised questions, but the CBN has outlined several reasons for its necessity:
- Promoting Digital Transactions: The policy encourages customers and businesses to adopt cashless payment methods, reducing reliance on physical cash.
- Reducing Fraud: By capping daily transactions, the CBN aims to limit the risk of fraudulent activities at PoS terminals.
- Operational Efficiency: This measure simplifies operations for PoS agents, ensuring a more standardized and secure system.
What PoS Operators Need to Do
If you are a PoS operator, here are five things you should do to comply with CBN’s new rules:
1. Understand the New Limits
As an agent, you must ensure that your terminal settings align with the N100,000 daily limit for individual customers and the N1,200,000 cumulative limit for agents.
2. Update Your Terminals
Work with your service provider to configure your PoS terminals according to the CBN’s directive.
3. Use the Approved Agent Code
Always use the approved Agent Code 6010 for all transactions. This step is critical to distinguishing your activities as agent banking services.
4. Educate Your Customers
Inform your customers about the new withdrawal limits and encourage them to plan their transactions accordingly.
5. Avoid Non-Compliance
Follow all directives strictly to avoid penalties. CBN has made it clear that violations will not be tolerated.
Benefits of the Policy
The daily withdrawal limit is not just about restrictions—it offers several benefits:
1. Encourages Financial Inclusion
By limiting cash transactions, the policy encourages more people to use digital payment systems, boosting financial inclusion.
2. Enhances Security
With less cash in circulation, there is a reduced risk of theft and fraud, making transactions safer for both agents and customers.
3. Supports Economic Growth
A cashless economy is more efficient, reducing the cost of printing and handling physical cash, which ultimately benefits the economy.
4. Promotes Accountability
Standardized limits make it easier for the CBN to monitor and regulate transactions, ensuring greater transparency in the financial sector.
Challenges PoS Operators Might Face
While the policy has its advantages, it also presents some challenges:
- Customer Complaints: Many customers may find the daily limits inconvenient, especially for larger transactions.
- Technical Adjustments: PoS operators may face initial difficulties in updating their systems to comply with the new rules.
- Increased Oversight: Agents will need to maintain accurate transaction records to avoid penalties.
FAQs
1. Why did the CBN introduce the N100,000 limit?
The CBN aims to promote a cashless economy, reduce fraud, and ensure standard practices across the financial sector.
2. Can customers withdraw more than N100,000 in a day?
No, the daily cash-out limit for customers is capped at N100,000 per terminal.
3. What happens if a PoS agent exceeds the daily limit?
Agents who exceed the N1,200,000 daily cash-out limit may face monetary fines or administrative sanctions.
4. How can PoS agents comply with the new rules?
Agents should update their terminal settings, use the approved Agent Code, and educate customers about the policy.
5. Does this policy affect merchant transactions?
No, the policy is specific to agent banking services and does not directly affect merchant activities.
The CBN’s N100,000 daily withdrawal limit on PoS terminals is a step towards creating a more secure and efficient cashless economy. While it may require adjustments from agents and customers, the long-term benefits outweigh the challenges.
By adhering to these new directives, PoS operators can contribute to a more transparent and reliable financial system in Nigeria.
