The Central Bank of Nigeria (CBN) has announced new guidelines for Point-of-Sale (POS) agents across the country, introducing a daily transaction limit of N1.2 million as part of efforts to strengthen oversight and standardise operations within the fast-growing agent banking sector.
The rule, contained in the Revised Regulatory Framework for Agent Banking, updates the 2020 version and reflects the CBN’s ongoing push to manage risks associated with cash handling, curb fraud, and improve transparency in last-mile financial services.
Since its formal recognition in 2013, agent banking has become one of the strongest drivers of financial inclusion in Nigeria. Over the years, POS agents have expanded access to cash withdrawal, bill payment, and fund transfer services in both urban and rural areas, processing billions of naira daily across multiple platforms.
However, with the rapid growth of these agents has come a rise in fraud attempts, liquidity pressures, and the informal use of POS terminals for bulk cash withdrawals — activities that often run counter to the goals of the CBN’s cashless policy.
By capping the daily transaction limit at N1.2 million, the apex bank aims to reduce the use of POS channels for high-volume cash movements and restore their focus to small, everyday retail transactions such as bill payments, airtime purchases, and petty cash transfers.
The CBN said the new limits are part of a broader effort to “enhance consumer protection, mitigate operational risks, and ensure that agent banking remains within acceptable retail thresholds.”
In simpler terms, the regulator is trying to ensure that POS terminals — originally designed to bring basic financial services to underbanked communities — do not evolve into informal cash distribution points that compete with bank branches or serve as conduits for untraceable cash flows.
The limit also aligns with the bank’s push to deepen digital adoption by encouraging customers to use formal banking channels and e-payment systems for larger-value transactions.
While the new limit is unlikely to disrupt smaller operators whose daily volumes often fall below N1 million, it may significantly impact high-volume agents, particularly in markets and transport hubs where bulk cash withdrawals are common.
Some POS operators have voiced concerns that the restriction could reduce liquidity or delay service for customers who need to withdraw larger sums. Others, however, believe the policy will promote healthier competition and discourage rent-seeking behaviour among agents.
“The CBN is tightening oversight to protect both agents and customers,” said one operator in Lagos. “It may affect some high-traffic locations, but overall it will help reduce fraud and improve trust in the system.”
Banks and payment service providers that manage agent networks are also expected to make operational adjustments. Many may deploy digital monitoring tools or real-time transaction alerts to ensure compliance with the new limits, while others will likely review their service-level agreements and agent onboarding processes.
Observers suggest the policy could trigger consolidation in the POS space, with smaller agents potentially merging into larger, more regulated networks.
For fintechs offering agent banking services, the change presents both a challenge and an opportunity: compliance costs will rise, but the policy could level the playing field by pushing out less-regulated operators and increasing customer trust.
The new guideline also spells out stricter penalties for non-compliance. Agents who breach transaction caps or operate outside approved service categories risk suspension or delisting. Principal institutions — including banks and fintechs — may face fines or operational restrictions if they fail to monitor their agents effectively.
To ensure transparency, the CBN has directed that all agent transactions be traceable and reported through approved payment channels. The apex bank also encouraged institutions to improve customer education to prevent misuse and ensure public understanding of the new limits.
The policy could tighten cash flow in the short term, but in the long run, it may strengthen trust in the financial system and accelerate digital adoption — if implemented transparently and consistently.
The key will be implementation balance — ensuring that compliance measures do not discourage small-scale operators or reverse gains in financial inclusion.
The limit, if applied flexibly, could make the market more structured without cutting off rural users, industry participants say. It is not intended as a punitive measure but as part of efforts to redefine the boundaries of agent banking and improve sustainability.
The N1.2 million daily limit marks another phase in the CBN’s ongoing reform of Nigeria’s cash economy. By tightening transaction controls while pushing digital channels, the bank is attempting to build a safer, more traceable payments ecosystem.
But as with previous policy shifts, its success will depend on enforcement consistency, collaboration with industry players, and the ability to communicate clearly with millions of POS agents and their customers.
If executed effectively, the policy could strengthen the foundation of agent banking — transforming it from a loosely regulated cash-out service into a more sustainable, data-driven pillar of Nigeria’s financial inclusion strategy.
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