A new policy of the Central Bank of Nigeria on agent banking may push about 40 per cent Point-of-Sale operators out of business.

The National President of the Association of Mobile Money and Bank Agents of Nigeria, Fasasi Sharafadeen, told Sunday PUNCH that the recently released guidelines by the apex bank could cripple small-scale businesses and threaten the country?s financial inclusion efforts.

The CBN released new operational guidelines for agent banking, capping the daily cumulative transactions per PoS agent at N1.2m.

Under the new framework, all agent banking transactions must be conducted through a dedicated account or wallet maintained by the principal financial institution to ensure transparency and better oversight.

A new policy of the Central Bank of Nigeria on agent banking may push about 40 per cent Point-of-Sale operators out of business.

The National President of the Association of Mobile Money and Bank Agents of Nigeria, Fasasi Sharafadeen, told Sunday PUNCH that the recently released guidelines by the apex bank could cripple small-scale businesses and threaten the country?s financial inclusion efforts.

The CBN released new operational guidelines for agent banking, capping the daily cumulative transactions per PoS agent at N1.2m.

Under the new framework, all agent banking transactions must be conducted through a dedicated account or wallet maintained by the principal financial institution to ensure transparency and better oversight.

The CBN warned that any agent found using non-designated accounts for operations would be in violation of the regulation and would face sanctions.

Agents involved in misconduct or fraud will be blacklisted or have their agreements terminated.

The framework further limits individual customer transactions to N100,000 daily, while agent devices must be geo-fenced to prevent unauthorised mobile use.

The CBN announced that implementation of the new agent location and exclusivity rules would begin on April 1, 2026.

According to Sharafadeen, one of the most worrying aspects of the policy is the introduction of exclusivity, which restricts agents to operate under only one principal or service provider.

He explained that this move would not only reduce the income of PoS agents but also drive many out of business due to the loss of flexibility and customer trust that currently defines agency banking operations.

?About 40 per cent of PoS operators will be out of business,? he said. ?Today, there are over 3 million PoS terminals in circulation, and about two million active agents. Many of these agents operate multiple terminals from different service providers to ensure efficiency and customer satisfaction. The new exclusivity rule will destroy that balance.?

He added that PoS operators usually relied on multiple platforms to ensure steady transactions when one network fails.

?Some agents choose a particular provider because of incentives like free bank transfers, while they use another provider that is faster in withdrawals,? he explained. ?This mix guarantees customer experience because even when one service is down, they can still serve their customers through another provider.?

The association president noted that the CBN?s argument for introducing exclusivity to enable easier monitoring and sanctioning of providers in cases of fraud, overlooks the realities of informal sector operations.

?The central bank may have good intentions of ensuring a safe and sound financial environment, but the implementation process is faulty,? he said.

?They did not consult stakeholders in the informal sector. Agency banking is not owned by the big service providers; it is driven by small business owners who finance their own operations.?

He further criticised the proposed 10-metre geofencing requirement for agent locations, describing it as impractical and counterproductive.

He argued that the new rule could lead to massive shutdowns across agent locations, especially in rural areas where banking services are limited.

The association also expressed concern over other provisions in the CBN policy, including non-permissible services that restrict agents from opening accounts or issuing cards, services that currently form a major source of income for operators.

?A lot of agents make more money from account opening and card issuance than from cash-in, cash-out services. By removing these, the CBN is taking away alternative income sources and pushing operators into losses,? he said.

The association called on the apex bank to revisit the guidelines, noting that its objectives could still be achieved without policies that stifle operators.

Fintech operators face exit

Sharafadeen noted that the policy, which stops agents from operating for multiple service providers, would hand undue advantage to a few dominant players already controlling most of the market.

?As of today, there are over 200 service providers offering agent banking services in Nigeria. But only about five of them control over 70 per cent of all registered agents.?

He noted that the biggest provider currently has around 500,000 agents, while the second has about 300,000, followed by others with 100,000 or fewer.

With the new exclusivity rule, experts warn that these top firms are likely to consolidate further control, while smaller fintech companies may struggle to retain or recruit agents.

PoS operators lament

Point-of-Sale operators also expressed concern that the Central Bank of Nigeria?s new regulation limiting daily transactions to N1.2m could force many of them out of business and worsen cash access for millions of Nigerians.

The operators, who spoke to Sunday PUNCH, said the new policy failed to consider the realities of their operations, especially those who combine cash services with retail trading or rely on the business as a primary source of income.

A PoS operator in Lagos, who identified himself as Oluwatobi, said the limit would significantly affect his daily operations and savings.

?I make about N15,000 daily from PoS transactions because I combine it with my provisions business. Sometimes, I give out cash of over N1.2m in a day, depending on demand. Other times, it?s lower. But the truth is, this policy will definitely affect my savings because we also buy cash to stay in business. The CBN is not considering that part,? he said.

Another operator, Akiyemi Olabode, who runs three PoS terminals in the Ikeja area of Lagos State, said the restriction would hurt small operators who depended on the business as a steady income source.

?I do this as a stable source of income and a good side hustle. I have up to three PoS machines. With this restriction, it?s going to be bad. Many of us will struggle to meet customers? demands or even survive,? he lamented.

Similarly, another PoS agent, who identified herself as Grace, described the policy as ?unfair? and ?anti-business,? especially for women who depended on PoS services to support their families.

She said, ?Most of us started this business to make ends meet. I attend to market women and traders who withdraw in bulk to buy goods. If CBN limits what I can give out daily, I?ll lose customers, and my income will drop. It?s not easy.?

They appealed to the apex bank to review the policy and adopt a more flexible approach that reflect the realities of cash flow, especially in rural and semi-urban areas where POS terminals remain the major source of access to cash.

Economists divided on policy

Commenting on the matter, a former Director of the Central Bank of Nigeria and the West African Institute for Financial and Economic Management, Akpan Ekpo, said the CBN should focus on improving the functionality of Automated Teller Machines across the country.

Ekpo, who spoke to Sunday PUNCH on the phone on Friday, said before the advent of PoS terminals, businesses relied on banks for transactions.

?The CBN is the ones regulating money, and I will not fault them for anything they are doing. However, before PoS, businesses were using banks, and I don?t see this discouraging them. What they should do is make sure the ATMs at the banks are functional,? he said.

He noted that while the CBN?s intentions might be linked to improving security and reducing cash circulation, its success would depend on proper monitoring and implementation.

?If the objective is to ensure there is less cash in circulation and transactions can be tracked, that would be lovely. But it may affect PoS operators, especially in rural areas. We should give it time and hope the monitoring system is effective,? Ekpo stated.

Also speaking, Head, Department of Strategy, Lagos Business School, Olawale Ajayi, noted that the new policy could strengthen security and accountability in the financial system if properly implemented.

He said linking the Bank Verification Number and Tax Identification Number of agents, as required by the new guidelines, would help trace fraudulent activities and curb impersonation.

?It will go a long way in addressing impersonation and tracing financial misconduct. Those whose BVNs are compromised should not be allowed to operate. If there is some level of consolidation and proper regulation of agents, it will strengthen the system,? Ajayi said.

However, the National Chairman of the Progressive Shareholders Association of Nigeria, Boniface Okezie, criticised the CBN for what he described as regulatory overreach, saying the apex bank should focus on its primary duties instead of micromanaging small businesses.

?Why should the CBN get itself involved in mundane things? They should give guidelines, not over-regulate. The CBN is all about tax and control. Who regulates the CBN itself? They should focus on fixing the quality of currency in circulation and ensuring banks dispense clean notes,? he said.

Okezie added that commercial banks often bear the cost of sorting bad currency, which should be the CBN?s responsibility. ?Commercial banks pay billions to sort out bad currency, yet the CBN is busy making new rules for PoS operators instead of doing what it?s supposed to do,? he added.

The CBN recently issued revised guidelines for agent banking operations, introducing stricter qualification requirements, due diligence processes, and operational limits for agents.

The move, according to the apex bank, is aimed at strengthening the integrity of the agent banking system and promoting financial inclusion. (PUNCH)

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