FG bans cash payments to MDAs, orders installation of POS terminals

President Bola Tinubu. Photo: Statehouse

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The Federal Government has banned the use of physical cash for the payment of revenue and directed Ministries, Departments, and Agencies to install Point of Sale terminals within 45 days.

The directive is part of four Treasury circulars issued by the Office of the Accountant-General of the Federation and obtained by The PUNCH on Monday.

In the documents, the Accountant-General, Shamseldeen Ogunjimi, said all payments to the Federal Government must now be made electronically and routed through channels approved by the Treasury.

“All payments to government must be made through electronic channels approved by the Office of the Accountant-General of the Federation and integrated into the appropriate Treasury Single Account,” the circular read, warning that the continued acceptance of physical cash is prohibited.

“In view of the above, it is hereby directed that collections and/or acceptance of physical cash (in Naira or other currencies) for all revenues due to the Federal Government is strictly prohibited.

“All revenue collections, for and on behalf of the Federal Government, must be made via electronic processing,” the circular stated.

The first circular, titled Enforcement of No Physical Cash Receipt Policy for All Federal Government Revenue Transactions, dated November 24, 2025, noted that the government was alarmed at the “continued physical cash collection” at MDA revenue points despite existing rules on e-payment and the Treasury Single Account.

It said physical cash collection violated extant policies and “weakens the integrity of Federal Government e-collection and e-payment systems.”

The circular directed all MDAs and Federal Government-Owned Enterprises to immediately sensitise staff and the public on the ban and to display notices reading “NO PHYSICAL CASH RECEIPT” and “NO CASH PAYMENT” at all revenue collection points.

It added that any MDA currently collecting cash must, within 45 days, deploy functional POS terminals or other approved electronic devices at all locations.

To enforce compliance, it warned that accounting officers would be held responsible for any breach.

A second circular, dated November 25, 2025, and titled Immediate Cessation of Direct Deductions on MDAs’ Dedicated Collection Systems, focused on unauthorised deductions made by MDAs through customised payment platforms.

According to the document, the Treasury observed that MDAs were using front-end applications linked to various Payment Solution Service Providers, through which charges, fees, and commissions were deducted before the net amount was remitted to the Treasury Single Account.

It said the practice violated existing regulations and had resulted in “significant revenue leakages, which undermine the Federal Government’s efforts to achieve fiscal transparency.”

The circular ordered an immediate halt, stating that all revenues must be remitted to designated TSA or Sub-TSA accounts “without any deduction(s).”

It stressed that any fees arising from service provision must now be paid directly from Treasury accounts rather than being deducted at source.

All existing portals and PSSPs used for revenue collection must also be regularised with the OAGF on or before December 31, 2025. MDAs involved in public-private partnerships were advised to seek further guidance from the Treasury.

The document warned that non-compliant MDAs would have their access to the Government Integrated Financial Management Information System and TSA accounts disabled.

A third circular, titled Adoption of the Federal Treasury e-Receipt (FTe-R) and dated November 26, 2025, introduced a mandatory national e-receipt system.

The circular said the Federal Treasury would, from January 1, 2026, begin issuing a unified electronic receipt for all Government payments. Only the centrally-issued FTe-R would be recognised as valid proof of federal transactions.

“With effect from 1st January 2026, the Treasury will commence the issuance of FTe-R,” the circular stated. The receipts will be issued through the Revenue Optimisation (RevOP) platform and delivered electronically via channels selected by each MDA. The FTe-R will serve both as a receipt for the payer and as official proof of revenue collection for the government entity.

The fourth circular, dated November 27, 2025, was titled Rollout and Implementation Guidelines on the Adoption of the Revenue Optimisation (RevOP) Platform.

It said the government was now deploying a digital platform to improve visibility of revenue collections, streamline billing, and allow real-time monitoring of accounts held by MDAs. RevOP has been adopted as the approved service-wide platform for end-to-end revenue optimisation.

According to the document, it will provide unified automation of billing, reconciliation, and treasury visibility, and integrate with TSA, GIFMIS, CBN, NIBSS, FIRS, and revenue-collecting banks.

Each MDA is required to nominate three officers to serve as RevOP focal personnel within seven working days and ensure integration of existing financial systems with the platform.

The circular added that only PSSPs licensed by the Central Bank, recommended by NITDA, and approved by the OAGF would be allowed to operate. All PSSPs currently used by MDAs must connect to the platform for “instant harmonisation of Government collections.”

The Treasury also ordered MDAs to submit full details of all local and foreign currency accounts and ensure compliance within 60 days.

All four circulars were signed by Ogunjimi, who directed accounting officers, finance directors, and internal auditors to give the documents the widest circulation and ensure strict compliance.

The measures represent some of the most far-reaching changes to federal revenue administration since the introduction of the Treasury Single Account a decade ago.

Earlier in March 2025, The PUNCH reported that the Federal Government unveiled a new payment platform named Treasury Management & Revenue Assurance System, designed to streamline and manage federal revenue collections and payments across MDAs, including those benefiting from donor funds, trust funds, social security funds, and special funds.

According to a memo seen by The PUNCH, the first phase covers payments and collections for the naira component only.

It also enables the OAGF and MDAs to generate bank statements, track balances, and activate automatic deduction and remittance of taxes associated with vendor and contractor payments, including VAT, Withholding Tax, and Stamp Duty.

The second phase, expected to commence on June 1, 2025, will cover collections and payments involving foreign exchange and integration with MDA Enterprise Resource Planning systems.

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