Nigeria’s Central Bank has dropped a massive new rulebook on the country’s agent banking sector. The bank says it wants to bring order to a messy system. Whether this is good sense or too much red tape remains to be seen.

The new “Guidelines for the Operations of Agent Banking in Nigeria,” released in October 2025, brings together over ten years of scattered rules into one thick document. 

How the system works

Agent banking in Nigeria has become key to getting financial services to regular people. Corner shops, petrol stations, and even beauty salons now work as mini bank branches. These agents — hundreds of thousands of them — handle cash deposits, withdrawals, bill payments, and transfers for Nigerians who may never visit an actual bank.

The system has three levels: Principals (the real banks), Super Agents (middlemen who recruit and manage agent networks), and the Agents themselves (the shopkeeper taking your cash). It’s worked well for getting banking to more people. Perhaps too well, according to the CBN.

What’s changing

The new rules aren’t completely new — they’re just now very detailed. The CBN has basically told everyone: “We’ve been watching, and we have notes.”

For agents, paperwork just multiplied. Individual agents must now be at least 18 years old, have a Bank Verification Number and National Identity Number, and work from a real location — meaning at least a kiosk that people can actually find.

They can now only work for one bank at a time. No more juggling multiple banking relationships, which seems a bit controlling but probably stops total confusion. This is a huge blow to enterprising agents who may have hoped to diversify their income by partnering with multiple banks.

The permissible list is also familiar: cash-in, cash-out, bill payments, and funds transfers. The non-permissible list, however, slams the door on any entrepreneurial overreach. Agents are explicitly forbidden from opening customer accounts, underwriting loans, or offering forex and investment services. They cannot use automated machines, and perhaps most frustratingly, they cannot delegate their work to someone else.

For banks acting as Principals, the demands are intense. They must do “enhanced background checks,” create detailed risk management plans, make sure all payment terminals accept all Nigerian bank cards (no playing favorites), and keep separate accounts for all agent transactions.

The most interesting bit? Banks must send daily reports on all agent transactions — withdrawals, limits, account balances — to NIBSS, which forwards them to the CBN. CBN is, now, definitely watching your cash movements.

For Super Agents, the middlemen managing agent networks, the rules are just as strict. They must have at least 50 agents spread across Nigeria’s regions (no hiding in Lagos), run training twice a year, and keep lists of banned agents. They also can’t do agent banking themselves — they can only manage others who do it.

Principal v Agent Relationship. At the heart of the new framework is a simple but onerous principle: the buck stops with the “Principal” — the licensed financial institution that hires the agents.

The CBN has decreed that Principals are “responsible for the actions or omissions of its Agent(s)… even if not authorized in the contract.” This single line, buried in Section 9.1.1, is enough to keep a bank CEO awake at night. This could mean that if an agent in a remote village engages in fraud, money laundering, or simply vanishes with a customer’s deposit, the bank is on the hook.

To manage this risk, the guidelines force banks into the role of helicopter parents. They must conduct enhanced due diligence, run continuous risk assessments, set individual transaction limits for each agent, and even establish dedicated internal units just to manage their agent networks.

Geo-Fencing, Money limits and the ₦1.2m problem

The CBN seems to be deploying a 21st-century toolkit to enforce 19th-century-style control.

Every PoS terminal must now be geo-fenced — technologically locked to operate only at the agent’s registered business address. This is a direct attempt to stop the practice of agents roaming with their terminals or operating from multiple, unapproved locations.

The CBN has also set daily money limits that seem both generous and tight at the same time. Individual customers can withdraw or deposit ₦100,000 daily (about $70), with weekly limits of ₦500,000.

But here’s the catch: each agent can only handle ₦1.2 million (about $800) in total withdrawals per day. For busy agents, this could mean turning customers away before lunch. The CBN says this stops money laundering; agents might say it stops them from doing business.

Technology demands

The rules show a lot of faith in Nigeria’s tech setup. Banks must use systems that work in real-time, make instant payments, reverse failed transactions immediately, and stay connected to agents constantly.

All devices must be locked to work only at registered locations — apparently agents might take their payment terminals on vacation. Two-step security is required for every transaction, and all alerts must include the agent’s name and GPS location. It’s unclear if anyone asked agents in areas with bad internet how this will work.

Serious penalties

The CBN hasn’t just written rules — it’s backed them with fines that hurt. Operating as a Super Agent without a license? That’s ₦10 million (about $7000), plus ₦200,000 for every day you keep doing it. Late with your monthly reports? ₦2 million upfront, then ₦250,000 daily until you send them.

Submit false information? ₦5 million and bank directors might get suspended. The message is clear: the CBN is done being nice.

For fraud, the rules say banks must help police investigate. Convicted agents get banned for life from agent banking.

The main problem

Here’s the big issue: agent banking exists because regular banks haven’t reached most of Nigeria. These agents work in places where formal banking doesn’t exist. Now they’re being told to keep the same records, use the same technology, and follow the same rules as a bank branch.

The CBN says this is about creating a “safe and stable financial system.” Critics might wonder if asking kiosk operators to understand money laundering laws and keep five years of detailed records is asking too much.

For the fintech companies, it’s even trickier. Their entire business model was built on speed and flexibility — sign up agents fast, deploy terminals quickly, scale rapidly. Now they’re being told to slow down, verify everything, and keep tight control. That’s the opposite of how they grew so big.

OPay, Moniepoint, and PalmPay have put Nigeria on the global fintech map, proving that African startups can scale to billion-dollar valuations. But more importantly, they’ve employed millions of Nigerians who were languishing in unemployment and poverty. Every agent with a PoS terminal is someone earning money, often in areas where formal employment barely exists.

The typical agent isn’t a tech entrepreneur. They’re a shop owner in a rural town, a kiosk operator in a Lagos suburb, a young person who saw agent banking as a way out of joblessness. For many, the daily commissions from cash-in and cash-out transactions mean the difference between making rent and not. Multiply that by hundreds of thousands of agents, and you’re talking about a massive informal employment sector that emerged in less than a decade.

These fintechs also forced traditional banks to wake up. They showed that financial inclusion wasn’t just possible — it was profitable. They pushed digital payments into corners of Nigeria that banks had written off as “unprofitable” or “too risky.” The competition they created lowered costs for everyone.

Now these same companies face rules that could fundamentally break their model. The looming compliance deadline, the hardware replacement costs, the geo-fencing restrictions — these aren’t just technical challenges. They’re threats to the livelihoods of millions of agents who depend on this system.

If smaller fintechs can’t afford compliance and shut down, what happens to their agents? If the cost of new terminals forces companies to reduce their networks, who loses their income first? Probably not the agents in wealthy Lagos neighborhoods.

The bottom line

Nigeria’s new agent banking rules are an ambitious attempt to clean up a sector that grew fast, maybe too fast for regulators to keep up. The CBN should get credit for bringing scattered rules together and tackling real problems like fraud, money laundering, and protecting customers.

The CBN’s concerns about fraud are also valid. The roaming PoS problem is real. Money laundering through agent networks is a genuine issue. But the risk remains that in trying to make agent banking perfectly compliant, the CBN might make it too complicated. Agent banking worked because it was simple: shopkeepers with basic technology bringing financial services where banks wouldn’t go. Whether that model survives all these new rules is anyone’s guess.

For now, the regulator has fired its warning shot. The age of compliance has begun, and it starts with a 10-meter leash, an agent chained permanently to an outpost.