The Central Bank of Nigeria (CBN) has introduced new rules to reshape the country's digital payments landscape, targeting ownership transparency, data localization, and market concentration. In a circular issued on Monday, the regulator mandated that payment companies must disclose their ultimate beneficial owners, removing layers of opacity created by complex corporate structures or holding companies. Starting January 2027, all payment transaction data generated in Nigeria must be stored on servers within the country, though companies can use local infrastructure providers such as Rack Centre, MainOne, Open Access Data Centres (OADC), and MTN instead of building their own data centres. The CBN's move aims to strengthen oversight, as data stored abroad limits regulatory access. A key restriction limits dominance across both consumer and merchant sides of the payments market: any institution controlling more than 25% of the consumer payments space—such as bank accounts, cards, or wallets—cannot own more than 15% of the merchant acquiring market, which includes payment gateways, PoS terminals, and related infrastructure, and vice versa. The digital payments sector in Nigeria processed ₦1.2 quadrillion ($884.78 billion) in 2025, underscoring the scale at stake. The CBN said the framework is designed to prevent overreliance on foreign technology systems and ensure the financial ecosystem remains under effective domestic supervision. These changes apply to all payment service providers operating in Nigeria, including banks, fintechs, and payment processors.
The CBN's data localization rule gives Nigerian infrastructure firms a guaranteed market, even if foreign-hosted data can still be accessed via legal channels. By capping cross-market ownership, the regulator is treating consumer and merchant dominance as inherently conflicting, not just competitive. This could slow down integrated fintech models that rely on controlling both ends of the payment chain. For Nigerian startups building full-stack financial platforms, the path to scale just got more fragmented.
Editorial note: AI-assisted opinion, not established fact. Full disclaimer →
