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CBN warns banks against payment cards discrimination

The Central Bank of Nigeria (CBN) has issued a warning notice to banks and acquirers to desist from the practice of payment cards discrimination, as observed breaches will attract appropriate regulatory sanctions.

This was disclosed in a circular to all banks, switching companies and other parties in the Nigerian payments system titled, ‘Interoperability and interconnectivity of the payments system infrastructure in Nigeria’, signed by Musa I. Jimoh, director, payments system management department.

The Central Bank said it has observed that a number of the acceptance devices deployed by banks discriminate between payment cards.

“For the avoidance of doubt, all certified payment acceptance devices deployed in Nigeria are required to accept all transactions arising from any card issued by any Nigerian bank,” the CBN said.

The circular serves as a reminder of the provisions of the guidelines on operations of electronic payment channels in Nigeria (June 2020).

According to the circular, the provisions of the guidelines include Section 2.4.1.3: which says merchant acquirers shall ensure that POS terminals purchased and deployed at merchant/retailer locations through CBN licensed Payment Terminal Services Provider shall accept all cards (card agnostic).

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Section 2.4.1.7: says to achieve interoperability, all POS terminals deployed in Nigeria shall accept all transactions arising from any card issued by any Nigerian bank. Accordingly, acquirers and other service providers shall be card neutral entities that have no reason to promote or favour any card brand over the other.

Section 2.4.1.8: says every acquirer must be able to accept all cards issued by Nigerian banks, whether through a direct licence or via an arrangement with any other acquirer that is licensed under the relevant card/payment schemes.