On CBN’s Bold, Timely Cleanup of POS Sub-sector
By Zekeri Idakwo Laruba
The Central Bank of Nigeria’s latest directives on agent banking and Point of Sale (POS) operations mark a watershed moment in the evolution of Nigeria’s financial system. For years, POS terminals have been the face of financial inclusion, bridging the gap between the formal banking world and the cash-dependent realities of ordinary Nigerians. But what began as an innovation to empower the unbanked has grown into a sprawling, often chaotic ecosystem. With the new guidelines, covering geo-tagging, single-principal affiliation, and transaction limits, the CBN is moving from passive oversight to active re-engineering of this space, in what can only be described as an unprecedented clean-up of Nigeria’s informal banking frontier.
Agent banking, at its core, allows third parties to provide financial services on behalf of licensed institutions. It was a brilliant solution for a country where millions live far from any physical bank branch. Yet, over time, the sheer speed of growth created loopholes. Multiple agents began operating under different financial institutions using the same POS terminals. Fraudsters cloned machines. Unregistered operators entered the field. Consumers suffered arbitrary charges, unresolved disputes, and, in some cases, outright theft. By 2025, the system had become too vital to ignore but too unruly to trust. That is the problem the apex bank now seeks to fix.
At the heart of the new reform is geo-tagging, an innocuous-sounding term with revolutionary potential. Every POS terminal in the country must now be digitally linked to a specific physical location, complete with GPS coordinates. This simple act transforms Nigeria’s financial landscape into a verifiable map, where every transaction can be traced to a real point on the ground. With geo-tagging, the regulator can see where money moves, detect unusual patterns, and identify suspicious clusters of activity. It also arms customers with the ability to verify legitimate agents and report misconduct backed by location data. In a country where faceless fraud has long thrived, geo-tagging promises a long-overdue dose of visibility and accountability.
The CBN’s insistence that PoS agents must now work with only one principal, whether a bank or a mobile money operator, further tightens the chain of responsibility. This is not bureaucracy for its own sake; it’s about clarity. The previous model, where agents juggled multiple affiliations, left everyone confused when things went wrong. Was the fault with the agent, the device provider, or the sponsoring bank? The new rule ends that ambiguity. By compelling agents to choose a single principal, the apex bank ensures that every complaint, transaction, or dispute has a clear line of resolution. It’s a return to structure in a marketplace that had long operated on improvisation.
The daily transaction limit of ₦1.2 million per agent, another part of the directive, may appear restrictive, but it is a necessary guardrail. It aligns with the CBN’s broader effort to ensure that agent banking remains a service for retail users, not a parallel system for high-value, unmonitored cash movements. When combined with the location tagging and single-principal policy, the message becomes unmistakable: financial inclusion cannot thrive without integrity, traceability, and order.
Beneath the technicalities lies a strategic motive. The CBN is reclaiming visibility over a sector that has grown faster than its regulatory net. The central bank is not only fighting fraud, it is gathering data, enforcing standards, and building a real-time understanding of how money circulates through Nigeria’s towns and villages. This kind of granular intelligence was impossible a decade ago. It will allow policy decisions to be rooted in evidence rather than estimates, and it signals the rise of a truly data-driven monetary authority.
No previous policy in Nigeria has attempted to bring this level of precision and transparency to grassroots financial activity. The geo-tagging initiative, in particular, is a first-of-its-kind attempt to integrate spatial technology into financial regulation. In effect, the CBN is not just regulating, it is redesigning the architecture of financial inclusion. If properly executed, this could become a model for other African nations grappling with similar challenges of informal financial systems and cash-heavy economies.
Still, the transition will not be smooth. Many small agents will struggle with compliance, either due to lack of awareness or the cost of upgrading their systems. Some may exit the business entirely, unable to meet the new technical and documentation standards. But such disruptions are the price of progress. In the long run, the reforms promise a cleaner, safer, and more predictable environment for both operators and consumers. Trust, once eroded by fraud and inconsistency, may finally begin to rebuild.
What the CBN has done is more than a regulatory update; it is a quiet revolution. For the first time, Nigeria’s financial regulator is not reacting to chaos but designing against it. It is asserting that innovation must coexist with order, that access must come with accountability, and that the digital economy must be mapped, not guessed. The success of this move will depend on execution, how faithfully agents, banks, and fintech operators align with the new rules, but the vision behind it is clear and courageous.
The new directives signal a maturing of Nigeria’s financial system, one where inclusion and regulation are no longer in conflict but part of the same conversation. The days of untraceable terminals and invisible operators are numbered. In their place, a transparent, geo-tagged, data-informed system is taking root. And in that shift lies a simple truth: the future of finance in Nigeria will not just be digital, it will be accountable.
Zekeri Idakwo Laruba is the Assistant Editor Economic confidential and PRNigeria. [email protected]