PoS Geo-tagging: FinTech Fear Disruptions, Losses as CBN Deadline Nears

Point-of-Sale (PoS) terminal issuers in Nigeria, mostly fintechs, are bracing for possible service disruptions and revenue losses as the Central Bank of Nigeria’s (CBN) October 31 deadline for the mandatory geo-tagging of all PoS terminals approaches.

With over 8.3 million registered PoS terminals in the country and 5.9 million already deployed as of March 2025, the scale of the exercise is massive.

The Nigeria Inter-Bank Settlement Systems (NIBSS), ahead of the implementation of this policy, has directed all PoS issuers to submit details of all their issued terminals for recertification.

The process, NIBSS said, will ensure regulatory alignment, improve location tracking, and enhance transparency in electronic payments.

But while regulators see this as a step toward better oversight and fraud prevention, fintechs and PoS operators warn that the cost of compliance, tight timelines, and rigid movement restrictions could slow market growth, disrupt services, and stall revenues.

Fintechs fear revenue stall 

Speaking to Nairametrics under the condition of anonymity, an executive at a leading fintech firm described the regulation as another burden that could dampen industry momentum, though the intention was good.

“This is a CBN regulation, and we are all going to bear the cost one way or the other. Aside from the technical costs, PoS growth is going to slow, and revenue is going to stall,” the official said.

The executive also flagged potential disruptions to merchant services due to the 10-meter movement limit for tagged terminals.

“A lot of merchants would suddenly realise their PoS is not working, probably because they move a few meters away from their place of business to attend to a customer. That limit is going to be a challenge for many,” he added.

Another fintech source echoed similar concerns, explaining that the uncertainty had already forced some issuers to halt expansion plans.

“We have technically stopped onboarding new PoS for now because we are focused on meeting the recertification deadline with NIBSS. The impact will be temporary, but there is no doubt this will slow down growth in the short term,” the source said.

PoS operators demand more time, flexibility 

The Association of Mobile Money and Bank Agents in Nigeria (AMMBAN), which represents thousands of PoS agents nationwide, has also raised red flags.

National Vice President of the association, Mr. Yusuf Adeyemo, told Nairametrics that the timeline for compliance was unrealistic given the scale of devices in circulation.

“Imagine we have over 7 to 8 million active PoS terminals and we are expected to geo-tag them all within 60 days. That is not practical, especially with challenges around address verification and network issues,” Adeyemo said.

He also criticised the 100-meter operational radius set by the CBN, arguing that it is too restrictive.

“If a PoS agent in a motor park moves within 100 meters from the tagged location, the terminal will stop working. That is not realistic. The regulator needs to increase that distance to allow flexibility,” he added.

• Adeyemo acknowledged that the policy could help reduce fraud, especially by preventing criminals from moving terminals to remote locations for illicit transactions.
• But he stressed that real impact would only come if the certification process included agents themselves, not just their devices.
• According to him, there is a need for a national register where all agents are verified, not just the machines.

“If you don’t certify the agent, fraudulent transactions will still slip through, even if the terminal is geo-tagged,” he said.

Why CBN is pushing geo-tagging 

The push for geo-tagging is part of a broader regulatory reform of the Central Bank of Nigeria.

In August, the CBN issued a circular mandating all players in Nigeria’s payments ecosystem, including Deposit Money Banks (DMBs), Microfinance Banks (MFBs), Mobile Money Operators (MMOs), Super Agents, and switching companies to adopt the ISO 20022 messaging standard and geo-tag all payment terminals by October 31, 2025.

The apex bank said the reforms would align Nigeria with SWIFT’s global migration timeline, improve payment data quality, and enhance oversight of electronic transactions.

“All payment transaction messages exchanged domestically or internationally must be formatted in ISO 20022 in line with CBN and SWIFT specifications,” the circular stated.

• On geo-tagging specifically, the CBN said all existing and new PoS terminals must be equipped with native geolocation services, supported by double-frequency GPS receivers, and tied to merchant locations with precise coordinates.
• Terminals not routed through a Payment Terminal Service Aggregator (PTSA) would not be permitted to operate, while Android OS 10 was set as the minimum software requirement.

“Geo-location data must be captured at the point of transaction and included in the message payload as a mandatory reporting field,” the bank said, adding that validation exercises would commence from October 20.

Potential gains and trade-offs 

From the regulator’s perspective, the benefits are clear: greater accountability, real-time visibility of transactions, reduced fraud, and enhanced customer trust.

NIBSS insists that geofencing capabilities and automated alerts will help authorities detect violations and prevent unauthorized use of terminals.

But industry players argue that the trade-offs are heavy. Compliance costs such as upgrading terminals, recertification fees, and software updates will fall on fintechs and operators, many of whom run on slim margins.

These costs may trickle down to consumers in the form of higher transaction charges. In busy markets, motor parks, and semi-formal retail spaces where agents often move around to serve customers, rigid geo-fencing could mean repeated transaction failures, eroding customer trust in digital payments.