An exposure draft on the procedures for electronic card issuance was released by the Central Bank of Nigeria on Wednesday. The CBN requested for input from stakeholders on the policy on or before February 27, 2014.
It stated that the procedures were developed to provide minimum standards and requirements for the issuance and usage of payment cards in Nigeria. It is also expected to enable issuing banks, financial institutions, processors and cards schemes upgrade and maintain their card operations to ensure optimum security, efficiency, cost effectiveness and customer friendliness.
Furthermore, it noted that all industry stakeholders that process, transmits or store cardholder information should ensure that their terminals, applications and processing infrastructure conform to the minimum requirements.
According to the document, only banks licenced by the CBN with clearing capacity shall issue payment cards to consumers and corporations in Nigeria. Banks without clearing can issue in conjunction with those with clearing capacity. All banks shall seek approval from the CBN for each card brand and type they wish to issue.
It added that the payment cards to be issued can be a “pay now” such as debit and prepaid or a “pay later” such as credit. These can be operated in different forms, including but not limited to: plastic cards; virtual card numbers (VCN). The usage channels, limits and frequencies shall be defined by the issuing banks.
According to the CBN, cardholders should in agreement with the issuing bank, have the flexibility to customise the usage limits, select transaction channels and other customisable features to suit their personal risk preferences.
It stated that all payment cards transactions shall be subject to current Nigerian Financial Intelligence Unit (NFIU) reporting requirements. All payment cards shall be EMV-compliant (i. e Chip and PIN enabled). The use of magnetic stripe cards is barred.