The Central Bank of Nigeria has relaxed its geo-fencing rules for Point-of-Sale terminals, extending the permissible radius for transactions from 50 metres to 70 metres, according to a circular issued on June 7, 2026. The adjustment, which takes immediate effect, is designed to reduce transaction failures and improve the user experience for merchants and customers by providing a slightly larger operational buffer for mobile PoS devices.
The CBN first mandated geo-fencing for PoS terminals in 2024 as a security measure to combat fraud and ensure that transactions are conducted within a verifiable physical location. The policy requires that a terminal's location, as determined by its GPS coordinates, must match the registered business address of the merchant. The initial 50-metre radius was intended to strike a balance between security and practicality, but industry feedback indicated it was too restrictive, particularly in dense urban environments where GPS signals can be inconsistent.
"The extension to 70 metres is a welcome and pragmatic step," said a Lagos-based payments consultant who requested anonymity. "It acknowledges the real-world challenges of GPS accuracy in our cities without compromising the core anti-fraud intent of the regulation. For a roadside merchant or a delivery agent, a few extra metres can mean the difference between a completed sale and a frustrating decline."
The rule change occurs against the backdrop of Nigeria's rapidly expanding digital payments landscape, where transaction volumes processed through the Nigeria Inter-Bank Settlement System platform now run into quadrillions of naira annually. The integrity of this system is paramount, and the CBN, in collaboration with NIBSS, has been implementing a series of layered security protocols. Geo-fencing is one component of a broader strategy that includes the Mandatory Address Verification System, which confirms a customer's address linked to their Bank Verification Number during certain transactions.
While the eased rule is a minor technical adjustment, it reflects the ongoing dialogue between regulators and the fintech industry. Operators of agency banking networks and fintechs that provide PoS services, such as OPay, Moniepoint, and Pocket by PiggyVest, have long advocated for regulatory clarity and adjustments that support financial inclusion without stifling innovation or convenience. The previous 50-metre limit was sometimes cited as a point of friction, especially for mobile merchants and in areas with poor satellite connectivity.
The CBN's directive applies to all acquiring banks and Payment Service Providers that deploy PoS terminals. It instructs them to update their systems to comply with the new 70-metre parameter. The central bank has stated that the geo-fencing requirement remains mandatory and that terminals operating outside the permitted radius from their registered addresses will continue to be declined. The move is seen as an incremental but positive development in fine-tuning Nigeria's digital payment regulations to better serve the market's evolving needs.