How Nigeria’s National Payment Stack works, why it matters, and what it means for banks, businesses, and consumers
Nigeria’s payment infrastructure enters a new era with the NPS, an upgrade built for speed, security, innovation, and seamless global integration.
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Last week, PalmPay and Wema Bank successfully completed the first live test of the National Payment Stack (NPS). <br />
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Developed by the Nigeria Inter-Bank Settlement System (NIBSS), the NPS has been in development for several months and is designed to modernise Nigeria’s payment infrastructure.<br />
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Nigeria is already a regional leader in digital payments, and the NPS aims not only to strengthen that position but also to expand it. According to NIBSS, the new system will enhance financial inclusion, enable secure real-time transactions, and streamline processes such as social benefit disbursement, tax collection, and revenue tracking.<br />
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In this article, we answer some of the key questions about the NPS and explore its potential impact on Nigeria’s payment ecosystem.<br />
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What is the National Payment Stack (NPS)? <br />
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The NPS is an upgrade on the NIP and is based on the ISO20022 messaging standard. Its objective is to improve security for digital payments and bring Nigeria in line with international payment standards. <br />
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“One of the core problems it has resolved is in the area of messaging and confirmation, including a digitally signed delivery of messages between one party and the other,” Premier Owoh, Managing Director and Chief Executive Officer of NIBSS, said. <br />
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How does it differ from the NIBSS Instant Payment (NIP)?<br />
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The primary difference between NIP and NPS is that the latter is built on the ISO20022 messaging protocol, whereas NIP used the SOAP messaging protocol. <br />
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ISO20022 is a global standard for the electronic exchange of financial data and has recently been designated by the Central Bank of Nigeria as the new messaging standard for payment transactions in Nigeria. The NPS is also billed to be faster than the NIP, with the live transaction reportedly going through in milliseconds. <br />
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Beyond a new messaging protocol, the NPS provides for a richer dataset to be collected by financial institutions. Additional services such as invoicing and cross-border payments can also be...
