As part of new measures to improve the seamless use of foreign-issued payment cards in Nigeria, the Central Bank of Nigeria has directed all banks and other financial institutions to implement multi-factor authentication for foreign card transactions.
The directive was contained in a circular dated December 18, 2025, issued by the CBN’s Financial Policy and Regulation Department and signed by its Director, Dr Rita I. Sike.
The circular, addressed to all banks and non-bank financial institutions, is titled “Facilitation of Seamless Use of Foreign Cards”, noted that the new requirement applies to all withdrawals and online transactions above $200 daily, $500 weekly, and $1,000 monthly, or their naira equivalents.
It added that the development is aimed at strengthening transaction security while improving the experience of tourists and Nigerians returning from the diaspora, and to enhance convenience, security, and user experience in foreign card usage across Nigeria.
The circular mandates that all banks and non-bank financial institutions should “implement multi-factor authentication for all withdrawals and online transactions exceeding $200 per day, $500 per week, and $1,000 per month (or its equivalent).”
In the circular, the CBN directed banks and non-bank acquirers to ensure uninterrupted and efficient local currency withdrawals, payments, and transfers for users of foreign-issued cards nationwide.
Beyond the multi-factor authentication requirement, financial institutions were instructed to maintain high system availability to guarantee seamless and uninterrupted transaction processing. All ATMs, point-of-sale terminals, and virtual or web-based payment platforms must also be properly configured to accept international cards routed through Nigerian acquirers.
The CBN further mandated that these terminals comply fully with global card association standards and possess the necessary certifications or recertifications to support smooth card transaction processing.
In addition, all merchant settlements arising from foreign card transactions must be made strictly in local currency (naira), while institutions are required to maintain sufficient liquidity to meet settlement obligations.
To reduce fraud risks, the CBN instructed financial institutions to implement robust transaction monitoring systems capable of detecting unusual usage patterns involving foreign cards across all terminals.
Merchants handling foreign card payments are also expected to be subject to strengthened know-your-customer and anti-money laundering controls. Where transactions appear suspicious, merchants must request valid identification documents and ensure that card-present transaction receipts are properly signed.
Suspicious transactions are to be reported promptly to the Nigerian Financial Intelligence Unit, in line with existing regulations.
The regulator also emphasised transparency in pricing and settlement. Banks and acquirers are required to clearly communicate applicable exchange rates to customers before completing transactions.
According to the circular, exchange rates for foreign card transactions must be market-driven and based on the prevailing official rate, with all associated charges disclosed upfront. Transactions are only to be completed after users have explicitly accepted the terms, with evidence of such acceptance retained.
In addition, acquirers are required to provide quarterly training to merchants and agent networks on dispute handling and chargeback processes.
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The CBN warned that consumer complaints arising from foreign card transactions must be resolved within approved timelines, noting that escalations to the central bank would attract appropriate 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.
The apex bank further directed institutions to recalibrate their fraud-monitoring systems to minimise false declines on legitimate foreign card transactions, a move aimed at improving user experience for visitors and returnees.
For low-value transactions, card acceptance devices must be equipped with contactless payment options.
The circular also introduced stricter obligations for acquirers around dispute resolution and chargebacks. Acquirers are required to implement and maintain robust, auditable chargeback management processes aligned with applicable card scheme rules and CBN guidelines.
This includes timely case intake, evidence collation, refund execution, and post-incident analysis. Institutions must also retain transaction documentation, such as terminal approval slips, signed merchant receipts, and item or service descriptions, for at least 12 months, with records retrievable within 24 hours upon request.
