The Central Bank of Nigeria (CBN) has directed banks and other financial institutions to implement multi-factor authentication (MFA) for foreign-issued card transactions as part of new measures aimed at improving their seamless use across the country.
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.
According to the circular, titled “Facilitation of Seamless Use of Foreign Cards” and addressed to all banks and non-bank financial institutions, the MFA requirement applies to all withdrawals and online transactions exceeding $200 per day, $500 per week, and $1,000 per month, or their naira equivalents.
The CBN said the move is designed to strengthen transaction security while improving the experience of tourists and Nigerians returning from the diaspora, enhancing convenience, safety and overall user experience in foreign card usage nationwide.
Under the directive, banks and non-bank acquirers are required to ensure uninterrupted and efficient local-currency withdrawals, payments and transfers for users of foreign-issued cards across Nigeria.
Beyond the MFA requirement, the regulator instructed institutions to maintain high system availability to guarantee seamless transaction processing. All automated teller machines (ATMs), point-of-sale (PoS) terminals, and virtual or web-based payment platforms must be properly configured to accept international cards routed through Nigerian acquirers.
The CBN also mandated full compliance with global card association standards, including the possession of all required certifications or recertifications to support smooth transaction processing.
In addition, all merchant settlements arising from foreign card transactions must be conducted strictly in naira, while institutions are required to maintain sufficient liquidity to meet settlement obligations.
To mitigate fraud risks, financial institutions were directed to deploy robust transaction-monitoring systems capable of detecting unusual or suspicious usage patterns involving foreign cards across all channels.
Merchants handling foreign card payments are to be subjected to enhanced know-your-customer (KYC) and anti-money laundering (AML) controls. Where transactions raise suspicion, merchants must request valid identification and ensure that card-present transaction receipts are properly signed. Suspicious transactions must be promptly reported to the Nigerian Financial Intelligence Unit (NFIU) in line with existing regulations.
The CBN also stressed transparency in pricing and settlement. Banks and acquirers are required to clearly disclose applicable exchange rates to customers before transactions are completed. Exchange rates must be market-driven and based on the prevailing official rate, with all charges disclosed upfront. Transactions may only proceed after customers explicitly accept the terms, with evidence of such acceptance retained.
Acquirers are further required to provide quarterly training to merchants and agent networks on dispute handling and chargeback processes. Consumer complaints arising from foreign card transactions must be resolved within approved timelines, with escalations to the CBN attracting appropriate sanctions.
Tourists and Nigerians in 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.
The apex bank also directed institutions to recalibrate their fraud-monitoring systems to reduce false declines on legitimate transactions, a move aimed at improving user experience for visitors and returning Nigerians.
For low-value transactions, card acceptance devices must support contactless payment options.
The circular introduced stricter obligations for acquirers on dispute resolution and chargebacks, requiring the implementation of robust, auditable chargeback management processes in line with card scheme rules and CBN guidelines. These include timely case intake, evidence collation, refund execution and post-incident analysis.
Institutions are also required to retain transaction records including terminal approval slips, signed merchant receipts, and descriptions of goods or services for a minimum of 12 months, with such records retrievable within 24 hours upon request.
