CBN Mandates Domestic Storage Of Payment Data Effective 2027
The Central Bank of Nigeria has directed banks, fintech firms and payment service providers to store all payment transaction data generated within the country on local servers effective January 1, 2027. The directive forms part of broader reforms aimed at strengthening oversight of the rapidly expanding digital payments sector.
In a circular issued by the Payments System Supervision Department and signed by its Director, Rakiya Yusuf, the apex bank also introduced new market structure guidelines and beneficial ownership disclosure requirements for operators. The measures apply to deposit money banks, microfinance banks, mobile money operators, switching companies, payment terminal service providers and other licensed entities.
The CBN said the reforms became necessary due to significant structural changes in the payments ecosystem, including rapid growth in electronic transactions and the emergence of operators with substantial market presence. While acknowledging that digital services have boosted innovation and financial inclusion, the regulator highlighted concerns over market concentration, operational dependence and the storage of critical data.
All financial institutions facilitating payments in Nigeria must now ensure that transaction data generated locally are stored and managed within the country in line with applicable data protection laws. Full compliance is required from the start of 2027.
The circular also mandates accurate and up-to-date disclosure of ultimate beneficial owners of significant shareholders, in line with existing anti-money laundering and counter-terrorism financing regulations. Institutions must make such records available to the CBN upon request.
To promote fair competition, the CBN introduced limits on market dominance. Any operator controlling more than 25 per cent of the card-issuing market in a rolling 12-month period will be restricted to a maximum of 15 per cent share in merchant acquiring during the same period. The reverse applies to dominant merchant acquirers. Affected institutions must submit monthly market share returns and achieve compliance by December 31, 2026.
Nigeria’s electronic payments sector has recorded substantial growth in recent years. Central Bank data show total e-payment transactions exceeding 38 billion in volume and reaching several quadrillion naira in value in recent periods, with POS and mobile channels driving much of the expansion. This growth has outpaced traditional banking infrastructure in many areas and raised questions about systemic risks and data sovereignty.
The directive aligns with global trends toward localisation of critical financial data and builds on previous CBN initiatives to enhance the integrity of the payments system. It comes at a time when regulators worldwide are tightening rules on data handling and competition in digital finance.
The CBN said it will monitor compliance and apply supervisory sanctions where necessary. The measures are intended to improve transparency, address concentration risks and safeguard the resilience of Nigeria’s payments infrastructure as the sector continues to expand.