The Central Bank of Nigeria (CBN) has published an exposure draft for its guidelines for contactless payment providers in Nigeria.
The apex bank disclosed this in a circular titled Exposure Draft To The Guidelines For Contactless Payments Nigeria, seen by Nairametrics.
According to the apex bank, the Guidelines were developed to make sure that individuals who participate in contactless payments take the proper risk management steps and adhere to the highest industry standards.
What the CBN is saying
Part of the circular by the CBN said, “The Central Bank of Nigeria furtherance of its efforts to standardise operations in the payments system while encouraging the deployment of innovative products and sustain financial system stability developed the draft Guidelines Contactless Payments in Nigeria.
“The draft Guidelines are hereby exposed to all banks, other financial institutions, payments service providers and the general public for comments. The comments should reach the Director, Payments System Management Department, CBN not later than November 5, 2022.”
The circular further explained that Contactless payments involve the consummation of financial transactions without physical contact between the payer and the acquiring devices.
During Contactless Payments, there is no need to handle cash or a card during transactions. Customers may not have to engage physically with a point-of-sale (POS) system, enter a PIN, or sign a receipt.
Contactless payment has been identified as an innovative payment option for the safe and efficient conduct of low-value large-volume payments.
Key takeaways
- Customers will have the choice to opt-in to contactless payments by applying for and accepting the products’ and services’ terms and conditions.
- The installation of devices and software will allow for contactless purchases of goods and services if a merchant accepts contactless payments. However, merchants will be responsible for fraudulent contactless payments caused by their carelessness or complicity.
- The successful switching between acquirers and issuers of all contactless transactions carried out by payment instruments issued in Nigeria is the responsibility of all local switching companies in that country.
- Following the guidelines Switching Companies must regularly evaluate the risks in their processes and take the required precautions to reduce any dangers connected to contactless payments.
- From time to time, the Bank will determine suitable transaction and cumulative daily limits for contactless payments. Stakeholders will be allowed to define boundaries within the confines of the Bank. Contactless payment transactions that are less than the specified restrictions per transaction/day, on the other hand, may not require consumer authorization (such as Personal Identification Number [PIN], token, biometrics, etc.).
