CBN To Lock Out POS Operators' Machines, Reasons Emerge

• The CBN has new instructions for PoS machines of banks and also fintech companies to tackle fraud
• One of the new changes is geo-tagging, which means that POS machines outside their registered location will be locked out
• The new rule will affect over 4 million PoS devices, and 1.5 million agents and will kick off from October

Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

The Central Bank of Nigeria has ordered banks and fintechs to geo-tag over 4 million PoS terminals.

Starting soon, any POS machine used outside its registered location will be shut down.

In plain terms, no more moving terminals around to do business in multiple places, and security agencies will be able to easily track fraud.

In a circular released on Aug. 25, 2025, the Central Bank of Nigeria (CBN) ordered operators, including Moniepoint, OPay, PalmPay and commercial banks to implement the new ruleles within 60 days.

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CBN issues new location rule for PoS operators, mandates terminal tracking

Millions of devices currently scattered across Nigeria must now be registered with exact GPS coordinates.

POS machines to be locked out

The apex bank stated that the directive is intended to curb fraud, prevent the use of cloned or “ghost” terminals, and enhance real-time transaction monitoring.

Under the new rules, PoS machines must be equipped with GPS systems and linked to the National Central Switch using a special software kit.

Merchants will only be allowed to process payments within a 10-metre radius of their registered business address, Punch reports.

Any device that is not geo-tagged by the deadline will be disabled, while new terminals must be tagged before activation.

Operators such as Payment Terminal Service Providers (PTSPs) and mobile money companies will be held responsible for ensuring their networks comply.

The CBN said compliance checks will begin on October 20, 2025 giving firms a narrow two-month window to upgrade what industry analysts estimate could be more than 4 million active PoS terminals nationwide.

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CBN issues new order to banks, OPay, Moniepoint, PalmPay, Kuda, others on POS machines in Nigeria

POS machines in Nigeria

Over the years, PoS machines have become a critical part of Nigeria’s financial ecosystem, with about 1.5 million agents recorded in 2023, roughly one for every 80 Nigerians.

However, their rapid expansion has also drawn regulatory attention, with the CBN introducing several oversight measures in recent years to combat fraud and enhance transparency.

The geo-tagging rule the CBN hopes will tighten control over Nigeria’s booming PoS industry and clamp down on fraudulent activities.

More money for POS operators as Nigerians transact over N14trn

Earlier, Legit.ng reported that data from the Nigeria Interbank Settlement System (NIBSS) revealed that PoS transaction volumes reached a new milestone, surpassing N14.86 trillion in just 10 months of 2024.

This amount represents a 38.27% increase compared to the N10.74 trillion recorded during the same period in the previous year.

The 2024 figure also reflects a 77.11% rise from the N8.39 trillion reported in 2022.

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Race against time: Meet Nigerian banking giants scrambling to meet CBN recapitalisation target

This growth is largely attributed to the convenience and accessibility offered by PoS operators, which has pushed many Nigerians to embrace digital payment solutions.

Source: Legit.ng