CBN begins registration for Operation of Indirect Participants in Payments System

The Central Bank of Nigeria (CBN) will effective November 1, 2019, to commence the regulation of operations of Indirect Participants in the Payments System.

According to a circular signed by Sam Okojere, director, payments System management, and released on Thursday, the move is in furtherance of the CBN’s mandate for the development of the electronic payments system in the country.

The objectives of the regulation include to set out the procedures for effective integration of indirect participants in the payments system in Nigeria; standardise the operation of indirect participants in the payments system, taking into cognisance their operational risks; provide mechanism and framework for the clearing and settlement of indirect participants payment instruments through the direct participating banks; and strengthen indirect participants for effective contribution to digital financial services in Nigeria.

To qualify as an indirect participant, an institution is required to; have a satisfactory risk-based rating from the CBN and secure a letter of recommendation from its direct participating bank, signed by the Chief Risk Officer and an Executive Director of the direct participating bank; and comply with the NUBAN Standards.

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The CBN said only direct participating banks are permitted to settle payment obligations of indirect participants.

An indirect participant shall settle all its payment obligations through only one direct participating bank per payment scheme at any given time.

According to the guidelines Indirect participants may take part in any of the following payments operations: Cheque Clearing; EFT & Bulk Payments; Instant Payments; Card Issuance;

Card Transaction Acquiring (ATM, POS, Web,etc.); Portals (e-Reference, Anti-Fraud, e-Signatory, e-Passport, etc.); Bank Verification Number System; and Any other component approved by the CBN.

Hope Moses-Ashike

Hope Moses-Ashike is an Associate Editor, Banking and Finance, with more than a decade of experience reporting on Nigeria’s financial system and broader economy. She closely tracks market movements, monetary policy decisions, company disclosures, regulatory actions, economic indicators, and global developments, and interprets what they mean for businesses, investors, policymakers, and households. Her reporting helps readers understand complex issues such as inflation trends, foreign exchange market dynamics, interest rate decisions, bank performance, and investment risks. She also covers major international events and periodically travels to Washington, D.C., to report on the World Bank/IMF Spring and Annual Meetings. Her dedication to financial journalism has earned her multiple recognitions and invitations to high-level professional development programmes. She is an alumna of the International Visitors Leadership Programme (IVLP) in the United States and holds an Advanced Financial Journalism Certificate from the Press Association Training in London, UK. Her other notable achievements include completing the Lagos Business School CMC Programme, the Bloomberg Media Africa Initiative Programme, and a Master Class in Journalism at Rhodes University in South Africa.