CBN Restricts POS Agents to One Bank Under New Regulatory Framework
The Central Bank of Nigeria (CBN) has unveiled a new regulatory framework that could transform Nigeria’s fast-growing Point-of-Sale (POS) and agent banking sector. Announced on October 6, 2025, the framework introduces a major change, the “exclusivity rule”, which mandates that every POS agent must now be affiliated with only one principal financial institution.
Under this new rule, each agent can work with only one commercial bank, microfinance institution, payment service bank, or mobile money operator. According to Startup Researcher, agents currently working with multiple fintechs or banks, such as Moniepoint, OPay, and PalmPay, must select a single partner before the policy takes effect on April 1, 2026.
Why the CBN Introduced the Exclusivity Rule
The CBN explained that the move is designed to improve traceability, curb fraud, and simplify regulation across Nigeria’s agent network. By ensuring each agent operates under a single principal, the apex bank aims to create a more accountable and transparent financial ecosystem.
Key motivations behind the policy include:
- Enhanced Oversight:
When agents work with multiple financial institutions, monitoring their transactions becomes complex. The rule makes it easier to supervise and audit agents effectively. - Fraud Prevention:
Multi-principal agents often exploit regulatory loopholes, leading to double-booking and cloned terminal fraud. Exclusivity aims to close these gaps. - Uniform Compliance:
The rule ensures every agent follows consistent Know Your Customer (KYC) and Anti-Money Laundering (AML) standards, reducing risks in the payment ecosystem. - Sector Maturity:
The policy aligns with the broader goal of formalising and strengthening the agent banking sector, moving it from an open system to a disciplined and well-regulated model.
Impact on POS Agents
For thousands of POS agents nationwide, the exclusivity rule marks a significant shift.
Potential challenges include:
- Loss of Income Diversification:
Many agents currently earn from multiple fintech platforms. Limiting them to one principal could reduce their income and customer reach. - Reduced Bargaining Power:
Smaller agents may struggle to secure favourable contracts with large institutions.
However, there are potential benefits. Exclusivity may lead to stronger partnerships with banks, improved training, liquidity support, and better compliance standards, resulting in a more professionalised agent network.
Implications for Banks and Fintechs
The exclusivity rule will reshape competition in Nigeria’s financial services sector.
- Recruitment Pressure:
Each bank or fintech must now attract and retain agents exclusively, potentially increasing recruitment costs. - Compliance Responsibility:
Institutions will carry greater operational risks and must strengthen internal monitoring systems. - Competitive Disruption:
Smaller fintechs may find it difficult to compete with larger players offering better commissions and support.
How Consumers Will Be Affected
For consumers, the rule could have mixed outcomes:
- Positive:
Improved oversight and accountability could reduce POS fraud, failed transactions, and irregularities, enhancing customer trust. - Negative:
In rural or underserved areas, access to POS services might decrease as agents tied to a single bank can no longer serve all customers. This could lead to longer queues and higher service fees.
Other Related CBN Reforms
The exclusivity rule forms part of a broader CBN strategy to strengthen Nigeria’s financial infrastructure. Other measures include:
- Transaction Caps: ₦100,000 per customer and ₦1.2 million per agent daily.
- Geo-Fencing: Agents restricted to a 10-metre operational radius.
- Geo-Tagging: Real-time tracking of POS terminals.
- Stricter Eligibility: Mandatory BVN, clean credit records, and verified business locations.
These reforms collectively aim to improve control, transparency, and financial discipline in the sector.
Concerns and Possible Consequences
Experts have warned that the new rule could create unintended challenges, such as:
- Agent Dropouts: Smaller or rural agents might exit the system if unable to secure exclusive deals.
- Market Concentration: Dominant banks and fintechs could monopolise agent networks.
- Operational Strain: Enforcing the rule across Nigeria’s estimated 5–6 million POS devices will be logistically complex.
- Innovation Slowdown: Limiting agents to one principal could restrict fintech experimentation and product diversity.
The Road Ahead
To prevent disruption, analysts recommend a phased implementation approach. Agents should carefully evaluate potential partners based on commission rates, settlement reliability, and customer support, while banks and fintechs must strengthen compliance frameworks and offer technical training.
Regulators, on their part, must balance discipline with flexibility, especially for small and rural operators, to maintain financial inclusion momentum.
Conclusion
The CBN’s exclusivity rule marks one of the most significant structural changes in Nigeria’s digital financial ecosystem. If properly implemented, it could reduce fraud, enhance oversight, and professionalise the POS sector. However, poor execution risks reducing agent coverage and stifling innovation.
As the April 2026 deadline approaches, how well stakeholders adapt will determine whether this reform becomes a milestone for stability or a setback for financial inclusion in Nigeria.
