CALABAR, Nigeria – The Central Bank of Nigeria, CBN, has established a N15,000 limit for contactless payments, with a daily cumulative limit not exceeding N50,000.
Transactions above the stipulated limit will require additional Know Your Customer, KYC, documentations and authorizations.
Contactless payment is a technological solution that allows for payments to be made without any physical interaction with the payment channels.
This modern method of payment can utilize a variety of instruments including pre-paid debit and credit cards, stickers, fobs, wearable devices, tokens, and mobile electronics devices.
The CBN released a new guideline on Tueday, June 27, 2023, outlining these measures, in which the bank stated that transactions exceeding the target limit should utilize contact-based technology.
The CBN Director of the Payment Systems Management Department, Musa Jimoh, communicated this directive in a circular to banks and other financial institutions.
According to Adefuye Adeyemi, CBN Deputy Director of the Payment Systems Management Department, the introduction of contactless payment is a proactive measure by the apex bank.
This is anticipated to ease potential inconvenience that may arise during the transition to new banknotes, a change expected to be implemented by December 31.
In a meeting with journalists in Calabar, Cross River State, Adeyemi outlined several benefits of the contactless payment system.
The system is expected to provide easy, convenient, and efficient cashless options for users while reducing queues at checkout points.
An interesting feature of contactless payment is the introduction of Free On Board, FOB, where the risk of loss shifts from the buyer to the seller.
“Contactless payment is more secure than traditional payment methods, giving customers peace of mind. It will reduce the printing of currency, thus saving the regulator cost of printing and managing currency in circulation.
Additionally, it reduces the spread of contagious diseases during payment due to the lack of contact,” Adeyemi said.
