- The Central Bank of Nigeria (CBN) has extended the compliance deadline for new automated anti-money laundering (AML) standards for financial institutions in Nigeria
- Deposit Money Banks now have 18 months, while other financial institutions have 24 months from March 10, 2026, to fully implement the new AML systems
- The extension revises the previously proposed 12-month compliance timeline, giving institutions more time to upgrade their systems and processes
The Central Bank of Nigeria (CBN) has extended the deadline for financial institutions to comply with its new baseline standards for automated anti-money laundering (AML) solutions, granting deposit money banks 18 months to meet the requirements.
Other financial institutions have been given up to 24 months from Tuesday, March 10, 2026, to achieve full compliance.
The revised timeline represents an extension from the previously proposed 12-month deadline when the apex bank initially introduced the guidelines.
In a circular dated March 10, 2026, the CBN stated, “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, payment service providers, and other financial institutions operating under the CBN’s supervision.
As part of the rollout, the apex bank instructed affected institutions to submit their implementation roadmaps to the Compliance Department within three months of the circular’s issuance, tightening the transition process for the new compliance framework.
According to the CBN, the standards are designed to strengthen financial system stability and integrity by providing a structured framework for automated solutions that tackle anti-money laundering, combating the financing of terrorism, and countering proliferation financing.
“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 framework, all financial institutions regulated by the CBN must deploy automated AML systems.
However, the complexity of these systems will depend on each institution’s size, risk profile, business model, transaction volumes, and operational complexity.
The standards are anchored on the Central Bank of Nigeria Act 2007 and the Banks and Other Financial Institutions Act 2020, and are intended to complement existing regulatory obligations rather than replace them.
The CBN emphasised that manual compliance controls are no longer sufficient as financial services become increasingly digital and complex.
Financial institutions are therefore required to implement systems capable of risk-based customer due diligence, real-time detection of suspicious transactions, and prompt reporting to regulatory authorities.
These include the Nigerian Financial Intelligence Unit and the CBN itself.
The regulator added that the standards align with recommendations from the Financial Action Task Force, covering system requirements such as transaction monitoring, customer due diligence, know-your-customer (KYC) and know-your-business (KYB) processes, sanctions screening, and the identification of politically exposed persons.
Other requirements include reporting systems, case management, audit trails, data protection, vendor management, fraud monitoring, unified customer risk profiling, and scalable system integration.
Institutions operating in high-risk sectors are expected to implement enhanced monitoring capabilities and integrate AML systems with KYC/KYB repositories and customer risk databases.
The systems must also support customer identification, risk assessment, sanctions screening, reporting, governance, and data protection processes.
The guidelines further encourage the adoption of artificial intelligence, machine learning, and advanced analytics to improve financial crime detection, provided such systems undergo independent annual validation, accuracy checks, fairness audits, and bias testing.
Additionally, the CBN mandated tamper-proof audit trails, role-based workflows, secure authentication protocols, and full compliance with the Nigeria Data Protection Act.
Financial institutions must also establish robust third-party and vendor management policies covering procurement, system implementation, technical support, incident response, and exit strategies.
Institutions applying for fresh licences must demonstrate compliance with the standards or present credible plans to meet the requirements.
The apex bank said compliance would be monitored through off-site surveillance, on-site examinations, thematic reviews, and other supervisory mechanisms.
The CBN also warned that institutions failing to meet the standards could face regulatory actions, including remedial directives, administrative sanctions, and penalties under existing laws.