If Nigerian fintech founders thought 2025 was a migraine, they might want to stock up on something stronger for 2026. The Central Bank of Nigeria (CBN) is closing out the year by issuing two significant policy documents that effectively reshape the operational landscape for traditional banks, neobanks, payment service banks (PSBs), and agency banking giants like Moniepoint, OPay, and PalmPay.
In a move that can be described as “aggressively prudent,” the regulator is squeezing the sector from two sides: making cash expensive to handle and making fraud significantly more expensive to ignore.
Part 1: The War on Cash (Reloaded)
The Circular: Revised Cash-Related Policies (Effective Jan 1, 2025)
The CBN has decided that the “carrot” approach to a cashless society is taking too long; the stick is back. Under the new directive (BSD/DIR/GEN/LAB/14/012), the cost of doing business in physical naira is about to go up — steeply.
For the agency banking networks that serve as the de facto ATMs for millions of Nigerians, the new math is brutal.
The Processing Fees:
- Individuals: If you deposit more than N500,000 in cash per day, the bank will charge a 3% processing fee on the excess.
- Corporates: The threshold is N3,000,000. Anything above that attracts the same 3% fee.
- The Mercy: The fee is capped at N1,000,000. That is, no matter how large the deposit is — the maximum fee charged will never exceed ₦1,000,000.(though if you are paying N1m in fees, you likely have bigger problems).
The Squeeze on Agents:
Fintechs rely on agents who collect cash from customers and deposit it to float their digital wallets. An agent in a busy market like Balogun or Alaba International easily collects over N500,000 daily. Under these rules, that agent is now paying a penalty for providing liquidity. The neobanks must now decide: absorb the cost and burn cash, or pass it on to agents who already operate on razor-thin margins.
Withdrawal Limits:
- POS Limits: Capped at N100,000 per day.
- Weekly Limits: Individuals are capped at N500,000 withdrawal per week across all channels (OTC, ATM, POS).
The Takeaway: The CBN is essentially telling the market that if you want to touch paper money, you’re going to pay a premium for the privilege.
Part 2: The “You Break It, You Buy It” Fraud Policy
The Document: Draft Guidelines for Handling Authorised Push Payment (APP) Fraud
If the cash policy is a bruise, the new draft guidelines on Authorised Push Payment (APP) fraud are a potential bone fracture for compliance departments.
Historically, if a customer was tricked into sending money to a fraudster (social engineering), the bank’s defense was simple: “You entered your PIN. You authorized it. Tough luck.”
The CBN’s new draft says: Not anymore.
The Liability Shift
The guidelines introduce a concept terrifying to risk officers: the bank is liable for reimbursement even if the customer authorized the transaction, provided the customer wasn’t “negligent.”
- The 50/50 Split: If the money is gone and neither the sending bank nor the receiving bank is technically “at fault,” they must split the reimbursement cost equally.
- The “Vulnerable” User: Financial institutions must apply a “higher duty of care” to vulnerable customers. In a market where digital literacy varies wildly, this definition is a potential minefield.
The Timelines (The “Sprint” Protocol)
The CBN has set deadlines that suggest they believe bank investigators do not sleep:
- Reporting: Customers have 72 hours to report fraud to be eligible for guaranteed reimbursement.
- Investigation: Banks have 14 working days to conclude investigations.
- The Payday: If the bank finds in favor of the customer, they must reimburse within 48 hours.
- Inter-bank Communication: If fraud involves another bank, the originating bank has 30 minutes to notify them.
The “Early Warning” Mandate
Banks are now required to implement an Early Warning System (EWS). They must “red flag” accounts that look suspicious — unusual inflows, repeated complaints, or behavioral anomalies.
The CBN is effectively asking fintechs to develop a “pre-crime” division. If a bank fails to flag an account that turns out to be a mule, they are fully liable for the losses. The days of onboarding users with just a phone number and a smile are definitively over.
The Impact: A Mature (and Expensive) 2026
For the top Nigerian fintechs, the “move fast and break things” era has been replaced by “move carefully or the CBN will break you.”
1. The Profitability Hit:
Fintechs like Kuda, FairMoney, and OPay have built models on low fees. The requirement to potentially reimburse social engineering victims — combined with the 50/50 liability split for “no-fault” fraud — creates a massive, unpredictable line item on the balance sheet.
2. The Friction Returns:
To avoid liability, fintechs will likely tighten the screws on transactions. Expect more “cooling off” periods for new beneficiaries, more aggressive blocking of “suspicious” transfers, and perhaps the end of instant, friction-free onboarding. Those who partner with banks may be yanked off if fraudulent activities persist.
3. The Agency Dilemma:
The cash deposit fees threaten the ubiquity of POS agents. If it costs 3% to deposit cash, agents may simply stop accepting large deposits, forcing cash back under mattresses — ironically achieving the exact opposite of financial inclusion.
The bottom line
The CBN’s message is clear: The financial system must be efficient (cashless) and safe (fraud-free), and the banks are going to foot the bill for both. For the consumer, this is ostensibly good news. For the fintech operator, 2025 is shaping up to be a year of expensive compliance and nervous glances at the transaction logs.