The Central Bank of Nigeria (CBN) has given Deposit Money Banks (DMBs) 18 months and other financial institutions 24 months from March 10, 2026, to fully comply with its new baseline standards for automated anti-money laundering (AML) solutions. The timeline is an extension from the previously reported 12 months.
In a circular dated March 10, 2026, titled Issuance of Baseline Standards for Automated Anti-Money Laundering Solution for Financial Institutions in Nigeria, the CBN directed all banks, mobile money operators, international money transfer operators, payment service providers, and other financial institutions to submit implementation roadmaps within three months. The circular was signed by Akinwunmi Olubukola, Director of Banking Supervision, and Olubunmi Ayodele-Oni, for the Director of Compliance.
The CBN explained that the standards aim to strengthen financial system stability and integrity, covering automated solutions for AML, combating the financing of terrorism (CFT), and countering proliferation financing (CPF) in Nigeria. “The Baseline Standards provide a framework for implementing automated solutions that strengthen detection and reporting of suspicious transactions in real time, while enhancing compliance with applicable AML/CFT/CPF laws and regulations and supporting emerging technologies in financial crime risk management,” the bank said.
All regulated institutions must operate automated AML solutions. The complexity and sophistication of each system will vary depending on the institution’s size, risk profile, business model, transaction volumes, and operational complexity. The standards complement existing legal obligations under the CBN Act, 2007, and the Banks and Other Financial Institutions Act, 2020.
CBN emphasised that manual controls are no longer sufficient in an increasingly digitised financial sector. Institutions are required to implement systems that support risk-based customer due diligence, timely detection of suspicious activities, and accurate reporting to the CBN, the Nigerian Financial Intelligence Unit (NFIU), and other authorities.
The standards align with Financial Action Task Force (FATF) recommendations and cover system requirements, transaction monitoring, customer due diligence (KYC/KYB), sanctions and politically exposed persons (PEPs) screening, reporting, case management, audit trails, data security, vendor management, fraud monitoring, unified customer risk views, and system integration and scalability. High-risk sectors must apply enhanced monitoring and ensure AML systems integrate with customer risk profiles.
The framework encourages the use of artificial intelligence (AI), machine learning, and advanced analytics, with independent annual validation, accuracy checks, fairness audits, and bias testing. Institutions must maintain tamper-proof audit trails, role-based workflows, secure authentication, and comply with the Nigeria Data Protection Act. Third-party and vendor management policies must cover procurement, implementation, support, incident handling, and exit strategies.
Financial institutions seeking new authorisation must demonstrate compliance or provide credible plans to meet the standards. The CBN will monitor compliance through off-site surveillance, on-site examinations, thematic reviews, and other supervisory mechanisms. Failure to comply may attract remedial directives, administrative sanctions, and penalties under existing laws, targeting both institutions and accountable individuals.
The CBN urged all stakeholders to ensure strict adherence to the guidelines, noting that it will continue to monitor developments and issue further guidance as necessary.
