CBN Mandates Localization of Payment Data by 2027

The Central Bank of Nigeria (CBN) has issued a directive requiring banks and fintech companies to localize payment transaction data within Nigeria, with a compliance deadline set for January 1, 2027. Rakiya Yusuf, the director of the Payment System Supervisory Department at CBN, introduced this new regulatory framework as part of a broader effort to strengthen oversight in Nigeria's rapidly growing digital payment ecosystem.

The localization rule mandates that transaction data generated within Nigeria must be stored and managed on local servers, aligning with Nigerian data protection laws. This initiative is expected to improve visibility, enhance consumer protection, and reduce operational risks associated with offshore data storage.

Furthermore, the CBN's directive includes stricter transparency requirements for payment service providers, focusing on the disclosure of ultimate beneficial ownership (UBO) to mitigate risks related to opaque ownership structures. The CBN aims to ensure compliance across the financial services sector as part of its regulatory priorities.