By Chinwendu Obienyi
Last week, the Central Bank of Nigeria (CBN) rolled out a new directive requiring all Point of Sale (PoS) terminals across the country to be geo-tagged within 60 days or risk being shut down after October 20.
The move, described by experts as a masterstroke in the crackdown on fraud, kidnapping and illicit financial inflows, came as a shocker to heterogeneous criminal networks. It was not predicted.
Point of Sale terminals have experienced explosive growth in Nigeria, transforming from fringe conveniences into essential financial infrastructure.
By 2024, PoS transaction values climbed to N18 trillion, a staggering 69 per cent increase from the N10.7 trillion recorded in 2023. This meant that agents numbering in the millions, replaced inaccessible automated teller machines (ATMs) and dwindling bank branches, bringing basic financial services to previously underserved communities.
Yet, with its meteoric rise came the risk as the proliferation of terminals outpaced regulatory capacity. This is because entities sometimes exploited PoS terminals for scams, unauthorised withdrawals or ransom collection, scenarios where perpetrators forced victims to transfer funds using nearby PoS machines to evade detections.
This situation became worrisome and hence the need for real-time monitoring and tighter regulatory control became pressing.
According to the CBN’s Payments System Supervision Department vital circular, under Rakiya Yusuf, the apex bank directed that all PoS terminals must have native geo-location services enabled, complete with double-frequency GPS receivers for enhanced accuracy.
“Existing PoS machines must be tagged; new devices must be geo-tagged before certification and activation. Terminals must transmit their location at the start of every transaction. Operations outside the 10-metre radius of the registered business address are automatically flagged, and non-compliant devices will be deactivated”, the circular said.
This would mean that operators including major fintech players like Moniepoint, OPay, and PalmPay, along with commercial banks, must register each terminal with a Payment Terminal Service Aggregator (PTSA) and provide precise merchant coordinates.
Also, terminals must run on Android 10 or higher to integrate with the National Central Switch, which will host the geolocation monitoring SDK. ISO 20022 messaging standard adoption is now mandatory by 31 October 2025, ensuring higher transaction data quality and alignment with global payment standards.
The apex bank further added that it will begin compliance checks from October 20, 2025, stating that this initiative is designed to enhance traceability, curb rampant fraud, and tighten regulatory oversight in a sector that has, until now, grown with minimal control.
Implications
Geo-tagging curtails the anonymity that ghost or cloned PoS terminals exploit. With every transaction traceable to a specific location at a precise time, the approach strengthens deterrence.
As stated earlier, PoS agents have sometimes been used by kidnappers to access ransom, this directive cuts that conduit. For consumers and law enforcement alike, it means transactions can be audited in near real time, potentially accelerating fraud detection and interventions.
However, compliance comes at a price. Updating or replacing PoS terminals to support GPS, newer Android versions, and the ISO standard may strain smaller operators.
Financial analysts’ views
Economic analyst and Vice Chairman, Board at Highcap Securities, David Adonri, called the directive a “revolutionary” step, one that not only curbs fraud but also accelerates the nation’s cashless agenda.
He, however, pointed out that legitimate roaming agents who move between locations could see their business model disrupted by the 10-metre strict geofence.
“These costs may ripple down to merchants or customers via higher fees or reduced convenience. Enabling GPS or software updates is only one side of the coin. The CBN and PTSA will need the capability to monitor, detect, and enforce violations effectively. The success of the initiative will hinge on institutional capacity to oversee a sprawling network of PoS terminals nationwide”, he said.
Tech enthusiast, Fascola Jamit, said, “This directive is a great idea but it might not choke off ransome and terror financing. Ransoms are traditionally paid in cash, so the tradition will not change. I feel this is some sort of monitoring of the informal market towards future tax.
Continuous location tracking raises data privacy and consent issues. Will the CBN establish guidelines on data usage, retention, or access by law enforcement? Only time will tell”.
For his own part, Portfolio Manager, Emmanuel Moses, stated that the directive could kill livelihoods. “There are merchants who register multiple PoS machines and franchise to others. I do not see why the 10-metre restriction is needed. Every transaction can be tracked. The financial institutions and the police just need to do their job and stop taking out on citizens trying to survive”, he argued.
The debate amongst stakeholders is how the CBN will handle partial compliance, disputes over geofencing breaches, grace periods, or waivers. Others question whether ISO 20022 adoption will genuinely improve transaction data quality and whether the directive will translate into measurable fraud reduction. However, one thing is for certain, the GPS directive could transform Nigeria’s payments landscape if small operators survive the compliance test.
Final word
The CBN’s geo-tagging mandate for PoS terminals represents a watershed moment in Nigeria’s drive toward safe, transparent, and resilient digital financial services. By demanding GPS integration, ISO 20022 compatibility, and real-time location checks, the apex bank is cementing oversight in an area once synonymous with regulatory blind spots.
Though the road to full compliance may be rocky, especially for smaller operators, the benefits for consumer protection, fraud deterrence, and system integrity are clear. As the October deadline approaches, the financial sector stands on the cusp of transformed accountability, ensuring that every tap, swipe, or push, is not only convenient, but traceably secure.
Leave a comment