Nigeria’s CBN Introduces Geofencing: A New Era for PoS Operations
A significant regulatory shift is on the horizon for Point of Sale (PoS) machine operators across Nigeria, as the Central Bank of Nigeria (CBN) rolls out an ambitious new directive. From October 2025, the CBN will begin enforcing a strict geofencing rule, mandating that all of the country’s 8 million registered PoS terminals operate within a precise 10-meter radius of their officially designated location. This move represents a fundamental change in the operational framework for digital payment services, impacting the vast network of agents facilitating transactions nationwide.
Geofencing: Combatting Fraud and Ensuring Compliance
Under the CBN’s new policy, every PoS device must be accurately geo-tagged to specific GPS coordinates, with all subsequent transactions required to include this crucial location data. This directive places immediate pressure on major fintech operators like OPay, Moniepoint, and PalmPay, who have been granted a tight 60-day period to ensure compliance. The primary motivation behind this stringent measure is the CBN’s intensified commitment to combating financial fraud and strengthening the integrity of Nigeria’s financial system. This renewed focus comes on the heels of Nigeria’s inclusion on the Financial Action Task Force (FATF) grey list in 2023, which spurred the regulator to enhance anti-money laundering and counter-terrorism financing efforts. This trend of location-based financial regulation is also observed across Africa; in 2024, Kenya’s Central Bank (CBK) implemented restrictions on where M-PESA agents could establish their services, highlighting a broader regional push for tighter oversight.
The CBN’s introduction of geofencing for PoS operations marks a pivotal moment for Nigeria’s thriving fintech ecosystem. While it presents considerable logistical and technical challenges for operators, it underscores a resolute dedication to enhancing financial security, curbing illicit activities, and cultivating a more transparent and trustworthy digital payment landscape. The successful implementation of this initiative is expected to set a new standard for regulatory frameworks within Nigeria and could inspire similar strategies in other African markets striving for robust financial governance and consumer protection.
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