The Central Bank of Nigeria (CBN) has embarked on a comprehensive modernization of the country’s payment infrastructure, mandating full migration to the ISO 20022 messaging standard and introducing stringent geo-location requirements for all payment terminals. The directive, issued through a circular dated August 25, 2025, and signed by Dr. Rakiya O. Yusuf, Director of the Payments System Supervision Department, requires compliance by October 31, 2025.
The mandate extends to all participants in the payments ecosystem, including Deposit Money Banks (DMBs), Microfinance Banks (MFBs), Mobile Money Operators (MMOs), Payment Terminal Service Providers (PTSPs), Payment Solution Service Providers (PSSPs), Switching and Processing Companies, and Super Agents. Nigeria’s Payment Overhaul is designed to strengthen transaction integrity, reduce fraud, and align the country’s systems with global financial standards.
Nigeria’s ISO 20022 Migration: Scope and Objectives
ISO 20022, developed by the International Organization for Standardization (ISO), is a global framework for financial messaging. It defines a universal language for financial transactions, using XML-based formats to create richer, more structured data exchanges across institutions. Unlike legacy systems, it enables the inclusion of detailed transaction metadata such as payer and payee identifiers, merchant and agent details, and other critical information. This standard improves transparency, efficiency, and interoperability across payment systems.
CBN ISO 20022 Migration Deadline: Under Nigeria’s ISO 20022 directive, all payment messages, whether domestic or international, must comply with the standard by October 31, 2025. The CBN will begin compliance validation from October 20, 2025, with non-compliant operators facing sanctions or exclusion from the national payment ecosystem.
CBN’s adoption of ISO 20022 serves three main objectives:
- Data quality and transparency – ensuring the accurate capture of transaction details to reduce errors and improve oversight.
- Fraud prevention – mandating precise identifiers and metadata to allow better monitoring and traceability of payments.
- Global integration – positioning Nigeria’s payment ecosystem to align seamlessly with Global ISO 20022 Adoption timelines and benchmarks, particularly the SWIFT-led global migration.
Geo-Location Mandates: Enhancing Oversight and Security
In parallel with ISO 20022 adoption, the CBN has introduced mandatory geo-location requirements for all payment terminals, including Point-of-Sale (PoS) devices. The measures are far-reaching:
- Dual-frequency GPS – all terminals must be fitted with receivers for precise location tracking.
- PTSA registration – devices must be registered with a Payment Terminal Service Aggregator (PTSA).
- NCS certification – terminals must be certified by the National Central Switch (NCS).
- Geolocation SDK – the NCS Software Development Kit (SDK) must be embedded into PoS applications, enforcing a maximum geofence radius of 10 meters around registered merchant locations.
- Android OS v10 or higher – all devices must run on a modern operating system to ensure compatibility with monitoring tools.
- Mandatory payload data – geo-location must be captured at the point of transaction and included as a required field in payment messages.
Existing terminals must be geo-tagged within 60 days of the circular, while new devices must comply before certification and activation. Terminals not routed through PTSA will be barred from processing transactions.
The geo-location mandate addresses long-standing fraud risks, particularly unauthorized relocation of PoS terminals and their misuse for illegal activities. By binding transactions to specific geographic coordinates, the CBN will gain granular visibility into financial activity, enforce compliance, and improve financial inclusion by ensuring devices operate only within registered merchant premises.
Comparison With Global ISO 20022 Adoption
Globally, ISO 20022 Adoption is accelerating as central banks and financial institutions shift from legacy messaging systems. The Society for Worldwide Interbank Financial Telecommunication (SWIFT) set November 2025 as the deadline for full migration, and many economies are aligning domestic frameworks accordingly.
- United States: The Federal Reserve’s FedNow service uses ISO 20022 to support instant payments and enhance interoperability.
- European Union: TARGET2, the EU’s large-value payment system, transitioned to ISO 20022 to improve efficiency and enable cross-border integration.
- Australia: The New Payments Platform (NPP) has incorporated ISO 20022 to enable real-time, data-rich transactions.
These systems benefit from the enhanced metadata, which supports advanced analytics, compliance with anti-money laundering (AML) rules, and smoother international connectivity.
Nigeria’s ISO 20022 migration is broadly aligned with these global shifts, but its approach is more sweeping. While regions like the EU phased adoption with an initial focus on large-value or cross-border transactions, Nigeria’s Payment Overhaul applies uniformly to all financial institutions and transaction types, both domestic and international.
Another distinction lies in Nigeria’s geo-location mandate. While global ISO 20022 adoption emphasizes data and messaging standards, few jurisdictions require terminal-level geo-tagging. Countries such as India and Singapore have applied location-based controls for specific use cases like ATMs or mobile banking. However, CBN’s requirement for dual-frequency GPS, PTSA registration, and strict 10-meter geofencing is unique, reflecting Nigeria’s need to address systemic risks linked to PoS fraud. By contrast, the EU’s Payment Services Directive 2 (PSD2) relies on strong digital authentication without mandating geo-location.
FAQs on Nigeria’s Payment Overhaul and ISO 20022 Adoption
1. Why did CBN set October 2025 as the ISO 20022 migration deadline?
The Central Bank of Nigeria aligned its migration deadline with the SWIFT global ISO 20022 Adoption cutover in November 2025. By setting an October date, CBN allows time to test, enforce compliance, and resolve issues before the global transition.
2. What happens if a bank or operator does not comply?
Institutions that miss the deadline risk being disconnected from Nigeria’s national payment ecosystem. This could prevent them from processing domestic and cross-border payments until compliance is achieved.
3. How will this affect ordinary consumers and merchants?
For consumers, the change should make transfers faster and more reliable, especially for remittances. Merchants, however, may need to upgrade or replace older PoS devices to meet geo-location requirements, which could increase costs in the short term.
4. Could transaction fees increase due to compliance costs?
While the CBN has not announced fee changes, banks and operators may pass compliance and hardware upgrade costs to customers. This could lead to slightly higher charges for electronic transactions.
5. How does Nigeria’s ISO 20022 adoption compare to other African countries?
Countries like South Africa and Kenya are moving toward ISO 20022, but Nigeria’s mandate is broader. It requires all financial institutions and operators to comply, while also introducing strict geo-location rules for PoS devices, an uncommon feature globally.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.