The Central Bank of Nigeria (CBN) has directed all banks and other financial institutions to implement multi-factor authentication for foreign card transactions exceeding $200 per day, introducing new rules aimed at improving security and ensuring the seamless use of foreign-issued payment cards in Nigeria.
The directive was issued in a circular dated December 18, 2025, by the CBN’s Financial Policy and Regulation Department and signed by its Director, Dr Rita I. Sike. Titled “Facilitation of Seamless Use of Foreign Cards,” the circular was addressed to all banks and non-bank financial institutions operating in the country.
According to the CBN, the new requirement applies to all withdrawals and online transactions above $200 daily, $500 weekly, and $1,000 monthly, or their naira equivalents. The apex bank said the measure is designed to strengthen transaction security while improving the payment experience for tourists and Nigerians returning from the diaspora.
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The circular directs banks and non-bank acquirers to implement multi-factor authentication for all qualifying transactions and to ensure uninterrupted local currency withdrawals, payments, and transfers for users of foreign-issued cards nationwide. Financial institutions were also instructed to maintain high system availability, with all ATMs, point-of-sale terminals, and virtual or web-based payment platforms properly configured to accept international cards routed through Nigerian acquirers. The CBN added that all terminals must comply fully with global card association standards and possess the necessary certifications or recertification.
The regulator also emphasised transparency in pricing and settlement, requiring banks and acquirers to clearly communicate applicable exchange rates to customers before transactions are completed. Exchange rates for foreign card transactions must be market-driven and based on the prevailing official rate, with all charges disclosed upfront. Transactions are to be completed only after customers explicitly accept the terms, with evidence of such acceptance retained. In addition, all merchant settlements from foreign card transactions must be made strictly in naira, while institutions are required to maintain sufficient liquidity to meet settlement obligations.
To curb fraud, the CBN instructed financial institutions to deploy robust transaction monitoring systems capable of detecting unusual usage patterns involving foreign cards across all terminals. Merchants accepting foreign cards are expected to comply with strengthened know-your-customer and anti-money laundering controls, including requesting valid identification for suspicious transactions and ensuring that card-present transaction receipts are properly signed. All suspicious transactions must be promptly reported to the Nigeria Financial Intelligence Unit in line with existing regulations.
The central bank also directed institutions to recalibrate fraud-monitoring systems to reduce false declines on legitimate foreign card transactions, a step aimed at improving user experience for visitors and returning Nigerians. For low-value transactions, card acceptance devices are required to support contactless payment options.
The circular further introduced stricter requirements for dispute resolution and chargeback management. Acquirers must maintain auditable chargeback processes aligned with card scheme rules and CBN guidelines, covering timely case intake, evidence collation, refunds, and post-incident analysis. Transaction records, including terminal approval slips, signed merchant receipts, and descriptions of goods or services, must be retained for at least 12 months and made available within 24 hours upon request. Acquirers are also required to provide quarterly training for merchants and agent networks on dispute handling and chargeback procedures.
The CBN warned that consumer complaints arising from foreign card transactions must be resolved within approved timelines, noting that unresolved cases escalated to the central bank would attract sanctions. Tourists and Nigerians returning from the diaspora who experience difficulties using foreign-issued cards were advised to report such incidents to the CBN’s Consumer Protection and Financial Inclusion Department, as the regulator said it would closely monitor compliance and penalise institutions found to be in breach of the directive.
