CBN Moves to Facilitate Card Pre-authorisation for Payment

Nume Ekeghe

The Central Bank of Nigeria (CBN) yesterday directed merchant acquirers and other operators in the...

payment system to take steps towards enhancing pre-authorisation and sales-completion of card transactions in the country.

According to the CBN, the directive became necessary because it had identified the predominant use of single messaging format for PoS transactions as an obstacle to the use of pre-authorisation as a mode of payment in Nigeria.

The banking sector regulator disclosed these in a circular posted on its website, that was signed by its Director, Payment System Management Department, Mr. Musa Jimoh, a copy of which was posted on its website.

In line with this, it directed all merchant acquirers to obtain Acquirer Device Validation Certification or the applicable testing completion notification from the CBN-licenced card schemes.

According to the Bank, by the directive, all PoS terminal must have the capability for transaction pre-authorisation and sales completion.

Also, PTSA (NIBSS) are to ensure that only banks that have conducted and obtained PoS terminal validation certificate for pre-authorisation and sales-completion from the relevant card schemes, have their PoS terminals registered on the Central Terminal Management System.

“All card issuers are required to build the capability and enable the processes for pre-authorisation and sales-completion of transactions.

“Card schemes are also required to provide online simulators for acquirers and issuers to test their systems, when necessary,” it added.

The central bank stressed that the circular takes immediate effect, but with a deadline of July 31, 2020, for full compliance, after which appropriate sanctions would be imposed for contraventions and non-compliance.

It explained that the move was part of its commitment to facilitate the development of the Nigerian payment system and deepen the adoption of various electronic payment options available to users.