CBN Requires Local Storage of Payment Data by 2027

The Central Bank of Nigeria (CBN) has issued a circular mandating that all banks and fintech firms must store payment transaction data generated within Nigeria on local servers by January 1, 2027. This directive, signed by Rakiya Yusuf, Director of the Payment System Supervisory Department, aims to strengthen regulatory oversight and ensure data sovereignty in the rapidly expanding digital payment ecosystem.

The CBN has observed significant structural developments in Nigeria's payment landscape, characterized by increased adoption of digital financial services. The new regulations require financial institutions to comply with data protection laws and maintain accurate records of ultimate beneficial ownership to combat money laundering and illicit financial flows.

Additionally, the CBN is introducing competitive rules to limit market dominance in the payment industry, restricting institutions from holding more than 25% of the card issuance market and 15% of the merchant acquiring market within a 12-month period. Compliance with these measures is expected by December 31, 2026.