CBN restricts financial institutions’ dominance in card issuing, merchant acquiring market

The Central Bank of Nigeria (CBN) has introduced new regulations aimed at limiting market concentration in the country’s payments ecosystem, placing caps on the share financial institutions can hold in both card issuing and merchant acquiring services.

Card issuing involves the provision of payment cards to customers, while merchant acquiring refers to the processing of card payments on behalf of businesses.

In a circular signed by Rakiya Yusuf, Director of the Payments System Supervision Department, the apex bank said the new framework is designed to address concerns around market dominance, systemic risk, operational dependence, and the localisation of payment transaction data.

ALSO READ: Makinde Swears in New Head of Service, Commissioners, as Cabinet Reshuffle Takes Place

The CBN noted that the rapid expansion of digital financial services has led to increased dominance by some operators, raising concerns about competition, resilience, and stability within the sector.

According to the bank, the measures are intended to promote transparency through beneficial ownership disclosure, reduce concentration risk, and strengthen the overall integrity of Nigeria’s payments system.

ALSO READ: Ex-Generals Blame Government Over Death of Retired Army Spokesman

Under the new rules, any financial institution holding more than 25 per cent market share in card issuing will be restricted in its participation in merchant acquiring services.

Similarly, institutions controlling more than 25 per cent in merchant acquiring will be limited in their card issuing activities, with both sides capped at 15 per cent in the opposite segment over a rolling twelve-month period.

ALSO READ: NASU Demands Equal Allowances With ASUU, Cites Rising Cost of Living

The CBN also said the reforms are part of broader ongoing regulatory changes in the financial sector, including proposed revisions to the licensing and regulation of financial holding companies, which may require HoldCos to hold shares in subsidiaries with ownership capped at 51 per cent.

ADVERTISE WITH US

Do you want to reach your targeted audience and expand your brand’s visibility?

Advertise with Polity Reporters to place your “message” before the right audience.

For advertising enquiries, reach us through:

Email: bandcommunications001@gmail.com

Facebook: Polity Reporters

WhatsApp: 07043810558

“Journalism is what we need to make democracy work.”

“News is what somebody somewhere wants to suppress; all the rest is advertising.”

“Journalism can never be silent: that is its greatest virtue and its greatest fault.”

“The duty of a journalist is to convey the truth as clearly and fully as possible.”

“Good journalism is about results. It is about affecting your community or your society in the most progressive way.”

“Journalism is printing what someone else does not want printed; everything else is public relations.”

“A free press is not a privilege but an organic necessity in a great society.”

“The press was to serve the governed, not the governors.”

“Journalism without a moral position is impossible.”

“The function of journalism is to comfort the afflicted and afflict the comfortable.”

Polity Reporters

Polity Reporters brings you news from Nigeria and around the world. The team follows developments closely and reports in a way that helps readers understand what is happening locally and internationally. Every piece is clear, reliable, and useful for anyone who wants to stay informed.