In order to enable pre-authorisation and sale-completion of cards transactions, the Central Bank of Nigeria (CBN) on Monday issued a circular on ‘Pre-authorisation of cards in Nigeria’ to merchant acquirers, Deposit Money Banks (DMBs) (issuers), payment service providers and card schemes.
The circular takes immediate effect, but with a deadline of July 31, 2020, for full compliance, after which the CBN will impose appropriate sanctions for contraventions and non-compliance.
The move is part of the regulator’s commitment to facilitate the development of the Nigerian payments system and deepen the adoption of various electronic payment options available to users.
In a circular signed by Musa Jimoh, director, payments system management department, the CBN said it had identified the predominant use of single messaging format for PoS as an obstacle to the use of pre-authorisation as a mode of payment.
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According to the circular, all merchant acquirers are required to obtain Acquirer Device Validation (ADV) Certification or the applicable testing completion from the CBN-licensed card schemes.
By the directive, all PoS terminals must have the capability for transaction pre-authorisation and sales completion. According to the circular, Payment Terminal Service Aggregator (PTSA) – Nigeria Inter-Bank Settlement System plc (NIBSS) is to ensure that only banks that have conducted and obtained PoS terminal validation certificate for pre-authorisation and sales completion, from the relevant card schemes, have their PoS terminals registered on the Central Terminal Management System.
All card users are required to build the capability and enable the processes for pre-authorisation and sales completion of transactions.
Card schemes are also required to provide online simulators for acquirers and issuers to test their systems when necessary.
