The Central Bank of Nigeria (CBN) has instituted transaction limits ranging from N15,000 per transaction to N50,000 cumulative daily for the country’s novel contactless payments system.
Contactless payments are a secure and convenient method of making transactions without physical contact between a payment device, such as pre-paid, debit, and credit cards, key fobs, mobile electronic devices, and wearable devices.
The technology, which is still new and hasn’t become very popular, will utilise near-field communication (NFC) technology, allowing users to simply tap or wave their payment device near the terminal to complete a transaction.
Business Post reports that in October 2022, the apex bank issued guidelines to commercial banks, financial institutions, and payment service providers on contactless payments in order to promote innovation in the sector.
In a circular on Tuesday, signed by Mr Musa Jimoh, the Director of the CBN Payments System Management Department, the lender said due to the risks associated with contactless payments, “verification and authorisation would be required for transactions above the limits”.
“Following the issuance of the guidelines on contactless payments in Nigeria and in cognisance of the risks associated with contactless payments, the bank, hereby, defines transaction limits above which verification and authorisation are required,” the circular reads.
“Transaction limits for contactless payments through accounts/wallets in Nigeria shall be as follows: transaction limit 15,000, daily cumulative limit N50,000.
“Higher-value contactless payments are transactions that exceed the above-stated limits and shall require appropriate verification and authorisation.”
The CBN further said for transactions above limits, “existing know-your-customer (KYC) requirements and limits on the electronic payment channels shall apply”.
“Limits above this stipulated daily cumulative limit shall be conducted using contact-based technology,” the CBN added.
This is the latest development in a string of recent policies instituted by the CBN. It recently directed commercial banks to collect and verify social media handles as part of their Know-Your-Customer (KYC) procedures.
Source: Business Post
