ABUJA, Nigeria (VOICE OF NAIJA)- The Central Bank of Nigeria has granted Deposit Money Banks 18 months to fully comply with its new baseline standards for automated anti-money laundering solutions, while other financial institutions have 24 months from March 10, 2026, to meet the requirements.
This represents an extension from the earlier 12-month period initially proposed by the apex bank for compliance with the guidelines.
In a circular dated March 10, 2026, the CBN said, “The implementation of these guidelines shall start from the date of issuance, while full compliance shall be 18 months (for Deposit Money Banks) and 24 months (for Other Financial Institutions) from the date of issuance.”
The circular, titled Issuance of Baseline Standards for Automated Anti-Money Laundering Solution for Financial Institutions in Nigeria, was signed by the CBN’s Director of the Banking Supervision Department, Akinwunmi Olubukola, and Olubunmi Ayodele-Oni for the Director of the Compliance Department.
It was addressed to all banks, mobile money operators, international money transfer operators, other financial institutions, and payment service providers.
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The CBN also directed institutions to submit implementation roadmaps to its Compliance Department within three months from the date of issuance, tightening the transition timeline for the new compliance framework.
According to the regulator, the standards are designed to strengthen financial system stability and integrity, noting that the framework covers automated solutions for anti-money laundering (AML), combating the financing of terrorism, and countering proliferation financing in Nigeria.
“The Baseline Standards provide a framework for implementing automated solutions that strengthen the detection and reporting of suspicious transactions in real time and enhance compliance with applicable AML/CFT/CPF laws and regulations, while also supporting the use of emerging technologies to improve overall financial crime risk management,” the bank stated.
Under the new standards, all banks and financial institutions supervised by the CBN must operate automated AML solutions, although the level of sophistication will depend on the institution’s size, risk profile, business model, transaction volumes, and operational complexity.
The standards are anchored on the CBN Act, 2007 and the Banks and Other Financial Institutions Act, 2020, and are intended to complement existing legal obligations rather than replace them.
The apex bank emphasised that manual controls are no longer adequate as financial services become increasingly digital and complex.
Institutions are therefore required to deploy systems that support risk-based customer due diligence, enable early detection of suspicious activities, and ensure accurate and timely reporting to the CBN, the Nigerian Financial Intelligence Unit, and other relevant authorities.
The framework aligns with recommendations of the Financial Action Task Force and includes requirements covering transaction monitoring, customer due diligence, know-your-customer and know-your-business procedures, sanctions and politically exposed persons screening, reporting, case management, audit trails, data security, vendor management, fraud monitoring, unified customer risk views, as well as system integration and scalability.
High-risk sectors or subsectors are expected to apply enhanced monitoring capabilities, ensuring that AML systems integrate with KYC/KYB repositories and customer risk profiles.
Institutions must support customer identification, risk assessment, sanctions screening, transaction monitoring, case management, reporting, audit, governance, and data protection processes.
The standards also encourage the use of artificial intelligence, machine learning, and advanced analytics, subject to independent annual validation, accuracy checks, fairness audits, and bias testing.
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In addition, the CBN requires tamper-proof audit trails, role-based workflows, secure authentication systems, and compliance with the Nigeria Data Protection Act.
Third-party and vendor management policies must also cover procurement, implementation, support, incident management, and exit strategies.
Financial institutions seeking fresh authorisation are required to demonstrate compliance with the standards or present credible plans to meet them. Compliance will be monitored through off-site surveillance, on-site examinations, thematic reviews, and other supervisory mechanisms.
The bank warned that failure to meet the standards could attract remedial directives, administrative sanctions, and penalties under existing laws, affecting both institutions and responsible individuals.
“All stakeholders are required to ensure strict compliance with the guidelines and all other regulations, as the CBN continues to monitor developments and issue further guidance as may be appropriate,” the apex bank added.