The CBN also gave banks 24 hours to reverse debit entries arising from failed transaction attributable to system-related issues.
The directives were contained in a 14-page ‘Guidelines for card issuance and usage in Nigeria’ released by the Banking and Payment System Department of the CBN on Tuesday.
The CBN guidelines read, “Any trapped card in the ATM shall be rendered unusable (by perforation) by the acquirer and returned to the issuer on the next working day.
“All debit entries arising from failed transactions attributable to system-related issues must be auto-reversed. Where auto reversal is not feasible, manual reversal must be carried out within 24 hours.”
“The security of the payment card shall be the responsibility of the issuer and the losses incurred on account of breach of security or failure of the security mechanism shall be borne by the issuer, except the issuer establishes security breach on the part of the card holder.”
Consequently, banks are to ensure ATM cards are issued from card schemes that have demonstrable fraud management systems.
Specifically, the CBN guidelines said banks were to ensure they deploy “robust fraud monitoring tools that have the capacity to monitor customer transaction trends, real -time operations and option of blocking suspicious transactions.”
The guidelines further read, “Liability shift rules shall apply when Nigerian issued EMV cards are used fraudulently on EMV compatible terminals where magnetic stripe fallback is enabled, or at non-EMV compatible terminals where the transactions is read as a fully magnetic stripe transaction.
“Card issuers are required to monitor their card production procedures to ensure that their EMV cards are properly produced. The issuer shall take full liability for any fraud from a fall back transaction that occurred as a result of improperly produced chip card.”
The central bank said the new guidelines were introduced to enable financial institutions and card processors to upgrade their card operations to ensure optimum security and customer friendliness, among others.
In the application of customer fees for services rendered, banks were to be guided in their operations by the CBN’s ‘Guide to bank charges’.
“Card issuers are expected to continuously educate cardholders on the following, among other things: security tips for safeguarding cardholder information; costs and charges associated with owning and using a payment card; contact numbers to the card issuer’s 24/7 contact centre in order to report cardholder issues or problems; dispute resolution process across the bank’s products and channels,” the CBN said.
