New Central Bank of Nigeria Policy on Agent Banking Sparks Concerns
The Central Bank of Nigeria (CBN) has introduced new guidelines for agent banking, which could significantly impact the operations of Point-of-Sale (PoS) operators. The policy includes several restrictions that have raised concerns among industry stakeholders.
Key Provisions of the New Guidelines
Under the new framework, the CBN has capped daily cumulative transactions per PoS agent at N1.2 million. Additionally, all agent banking transactions must be conducted through a dedicated account or wallet maintained by the principal financial institution. This is intended to ensure transparency and better oversight.
The CBN has also warned that agents found using non-designated accounts for operations would face sanctions. Agents involved in misconduct or fraud will be blacklisted or have their agreements terminated. Furthermore, individual customer transactions are limited to N100,000 daily, and agent devices must be geo-fenced to prevent unauthorized mobile use.
The implementation of the new agent location and exclusivity rules will begin on April 1, 2026.
Impact on PoS Operators
The National President of the Association of Mobile Money and Bank Agents of Nigeria, Fasasi Sharafadeen, expressed concerns about the new policy. He highlighted that the introduction of exclusivity, which restricts agents to operate under only one principal or service provider, could reduce the income of PoS agents and drive many out of business.
Sharafadeen explained that many agents currently operate multiple terminals from different service providers to ensure efficiency and customer satisfaction. The new exclusivity rule could disrupt this balance, as agents rely on multiple platforms to maintain steady transactions when one network fails.
He noted that some agents choose a particular provider because of incentives like free bank transfers, while they use another provider that is faster in withdrawals. This mix guarantees customer experience, as agents can still serve their customers through another provider when one service is down.
Stakeholder Reactions
The association president criticized the CBN’s argument for introducing exclusivity, stating that it overlooks the realities of informal sector operations. He argued that the central bank did not consult stakeholders in the informal sector, as agency banking is driven by small business owners who finance their own operations.
Sharafadeen also criticized the proposed 10-meter geofencing requirement for agent locations, describing it as impractical and counterproductive. He warned that the new rule could lead to massive shutdowns across agent locations, especially in rural areas where banking services are limited.
The association also expressed concern over other provisions in the CBN policy, including non-permissible services that restrict agents from opening accounts or issuing cards. These services currently form a major source of income for operators.
Fintech Operators Face Exit
Sharafadeen noted that the policy, which stops agents from operating for multiple service providers, would hand undue advantage to a few dominant players already controlling most of the market. As of today, there are over 200 service providers offering agent banking services in Nigeria, but only about five of them control over 70% of all registered agents.
Experts warn that these top firms are likely to consolidate further control, while smaller fintech companies may struggle to retain or recruit agents.
PoS Operators Lament the Policy
Point-of-Sale operators also expressed concern that the CBN’s new regulation limiting daily transactions to N1.2m could force many of them out of business and worsen cash access for millions of Nigerians.
Operators, who spoke to Sunday PUNCH, said the new policy failed to consider the realities of their operations, especially those who combine cash services with retail trading or rely on the business as a primary source of income.
A PoS operator in Lagos, Oluwatobi, said the limit would significantly affect his daily operations and savings. Another operator, Akiyemi Olabode, lamented that the restriction would hurt small operators who depended on the business as a steady income source.
Grace, another PoS agent, described the policy as “unfair” and “anti-business,” especially for women who depended on PoS services to support their families.
They appealed to the apex bank to review the policy and adopt a more flexible approach that reflects the realities of cash flow, especially in rural and semi-urban areas where POS terminals remain the major source of access to cash.
Economists Divided on Policy
Commenting on the matter, former Director of the Central Bank of Nigeria and the West African Institute for Financial and Economic Management, Akpan Ekpo, suggested that the CBN should focus on improving the functionality of Automated Teller Machines across the country.
Olawale Ajayi, Head, Department of Strategy, Lagos Business School, noted that the new policy could strengthen security and accountability in the financial system if properly implemented.
However, Boniface Okezie, National Chairman of the Progressive Shareholders Association of Nigeria, criticized the CBN for what he described as regulatory overreach. He argued that the apex bank should focus on its primary duties instead of micromanaging small businesses.
