The Central Bank of Nigeria (CBN) has directed banks, payment service providers, acquirers, and other financial institutions to fully reroute all Point-of-Sale (PoS) transactions through Nigeria’s two licensed Payment Terminal Service Aggregators (PTSAs), giving the industry a one-month deadline to comply.
The new directive, contained in a circular dated December 11, 2025, is aimed at reducing frequent PoS transaction failures and system downtimes that have continued to disrupt digital payments across the country. The circular was signed by Rakiya Yusuf, Director of the CBN’s Payments System Supervision Department.
Under the updated guidelines, all PoS transactions, whether initiated from physical terminals or electronic payment channels, must be connected to both the Nigeria Inter-Bank Settlement System (NIBSS) and Unified Payment Services Limited (UPSL). This dual routing requirement replaces single-channel dependencies that have often left transactions stranded whenever one aggregator experiences technical issues.
Automatic failover now mandatory
A key element of the CBN’s directive is the requirement for automatic failover capability. Financial institutions must ensure that transaction traffic can seamlessly switch between NIBSS and UPSL whenever one platform is unavailable, allowing PoS payments to continue without disruption.
According to the CBN, this redundancy is critical to eliminating single points of failure that have contributed to persistent transaction declines, delayed reversals, and merchant loss issues that have eroded confidence in Nigeria’s digital payments ecosystem.
Stronger monitoring and incident reporting
Beyond routing changes, the central bank is also tightening operational oversight across the payments value chain.
NIBSS and UPSL have been instructed to work closely with regulated institutions to test and confirm that systems can sustain uninterrupted transaction processing. The results of these validation tests will form part of the CBN’s supervisory assessments.
In cases of system outages or service disruptions, both aggregators are now required to immediately notify affected financial institutions and submit a detailed incident report to the CBN within 24 hours, explaining the cause of the disruption, its impact, and corrective actions taken.
January 2026 compliance deadline
The directive effectively gives industry players until mid-January 2026 to complete integration, configuration, and testing required for full compliance. While the CBN did not specify penalties in the circular, failure to meet the deadline could expose institutions to regulatory sanctions.
Why this matters
PoS terminals remain central to Nigeria’s cashless economy, processing millions of daily transactions across retail outlets, service businesses, and the informal sector. However, recurring network failures and unsuccessful transactions have become a major pain point for merchants and consumers alike.
By enforcing dual connectivity and mandatory failover between NIBSS and UPSL, the CBN is seeking to significantly improve transaction success rates, enhance system resilience, and restore trust in electronic payment channels as usage continues to grow.
The move builds on earlier regulatory efforts such as PoS geo-tagging requirements and the migration to modern messaging standards, all part of the CBN’s broader push to modernise Nigeria’s payments infrastructure and strengthen oversight of digital financial services.
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