Central Bank of Nigeria data localization mandate pressures fintechs

The Central Bank of Nigeria (CBN) has issued a directive requiring all payment transaction data generated within the country to be stored and managed locally by January 1, 2027. This mandate affects banks, fintechs, mobile money operators, and other licensed payment service providers.

Industry experts highlight significant technical and operational hurdles. Hakeem Adeniji-Adele of eTranzact noted that the sheer volume of data to be moved makes the current timeline difficult to meet. Beyond simple database transfers, institutions must address computing capacity, storage, cybersecurity, and power reliability.

To mitigate disruption, some financial institutions may adopt a ‘split-cloud architecture.’ This approach involves moving regulated databases to domestic infrastructure while keeping applications and business logic on international public clouds. While this can reduce immediate service interruptions, experts warn it may create new dependencies between local data and foreign-hosted applications.