The Central Bank of Nigeria has issued a regulatory framework for non-bank acquiring in Nigeria.
According to a circular by the apex bank, the objectives of the framework are to “establish non-bank acquiring as a regulated service in Nigeria; and provide minimum standards and requirements for the operations of non-bank acquiring in Nigeria”.
The framework set out the procedures for the operation of non-bank merchant acquiring in Nigeria, including the rights and obligations of the parties involved in the process.
It compelled non-bank merchant acquirers to meet the minimum standards of operations as approved by the bank.
The CBN said the regulatory framework would guide activities of the participants in the provision of non-bank acquiring services in Nigeria.
The participants in the framework are non-bank acquirer, settlement bank/sponsor bank, merchant’s deposit money banks, card schemes, other payment schemes and Nigeria Central Switch.
The CBN said this was also part of efforts to promote a sound financial system and facilitate the development of electronic payment system in Nigeria.
Non-bank acquirers as only licensed switching and processing companies, other than acquiring banks, would be allowed to process and settle transactions on behalf of merchants in Nigeria, it stated.
The bank would approve non-bank acquirers, as it deemed necessary, from time to time.
The non-bank acquirer will have and implement policies that include minimum standards established by the payments schemes (including card schemes) to mitigate risk to the payment system.