The Central Bank of Nigeria (CBN) recently introduced new rules that will require banks, fintech companies and other payment service providers to store payment transaction data generated in Nigeria on local servers from January 1, 2027.

The directive is aimed at strengthening oversight of the country’s growing digital payments industry.

In this article, Tribune Online takes a look at seven key things to know about the new data rule.

•Payment transaction data must remain in Nigeria

Under the new rule, all payment transaction data generated within Nigeria must be stored and managed in the country.

The CBN said banks, fintech firms and other payment operators must comply with the requirement from January 1, 2027.

The move is expected to strengthen data sovereignty, improve regulatory supervision and ensure sensitive financial information remains within Nigeria’s jurisdiction.

•Banks and fintech companies are affected

The directive applies to a wide range of financial institutions and payment operators.

They include deposit money banks, microfinance banks, mobile money operators, switching and processing companies, payment terminal service providers, payment solution service providers, super agents and other licensed payment firms.

•Firms must disclose their real owners

The new framework also requires payment operators and financial institutions to maintain accurate records of their ultimate beneficial owners.

Ultimate beneficial owners are the individuals who ultimately own or control a company, even when ownership is held through other entities.

The CBN said institutions must provide such information whenever requested and comply with existing anti-money laundering and counter-terrorism financing regulations.

•New limits have been introduced to prevent market dominance

The apex bank has also introduced competition measures designed to prevent excessive dominance by a single operator in the payments industry.

Under the framework, a company controlling more than 25 per cent of the card-issuing market will be restricted from holding more than 15 per cent of the merchant-acquiring market.

Likewise, operators with more than 25 per cent of the merchant-acquiring market will be limited to a maximum of 15 per cent of the card-issuing market.

The measure is intended to reduce concentration risk and promote competition within the sector.

•Operators will submit monthly reports

Affected institutions will be required to submit monthly market share reports to the CBN using approved templates and timelines.

The regulator said this will help it monitor developments within the payments ecosystem and enforce compliance.

•Full compliance deadlines have been set

While payment data localisation takes effect on January 1, 2027, institutions are expected to comply with the new market structure requirements on or before December 31, 2026.

The CBN warned that compliance will be closely monitored.

•Defaulters could face sanctions

The apex bank said institutions that fail to comply with the directive could face supervisory sanctions in line with existing laws, regulations and guidelines.

According to the CBN, the reforms are aimed at promoting transparency, strengthening oversight and ensuring a resilient payments ecosystem in Nigeria. (TRIBUNE)

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