Emma Okonji commends the Central Bank of Nigeria for kickstarting the process of migrating its payments transaction data currently being hosted outside of the country, with the intent to host such data in Nigeria to ensure national data sovereignty
The Central Bank of Nigeria (CBN), on June 15, 2026, issued a circular requiring financial institutions and fintech companies operating in Nigeria to migrate their payments transaction data generated within Nigeria, but stored and hosted outside of Nigeria.
The circular mandated all financial institutions and fintech companies to migrate such data back to Nigeria for local hosting and management in Nigeria with full compliance set for 1st of January, 2027.
Since the circular was issued, not many fintech companies saw the need for data migration. They are of the view that it will not be possible to migrate such data back to Nigeria, for fear of losing sensitive data in the process of migration. Some are skeptical, raising further fears about insecurity in the country, and the possibility of losing sensitive data to national insecurity. While some financial institutions doubt the competency of local data centres in Nigeria to host their sensitive payments transaction data in Nigeria, others are planning to migrate only few data back to Nigeria, and still keep the bulk of their application data running outside of Nigeria, just to obey the CBN’s directive.
But the CBN, last week in Lagos, issued a policy statement during the ‘CloudReady Nigeria Financial Services Roundtable’, organised by Africa Hyperscalers, warning that the January 1, 2027 deadline for data migration and localisation was not negotiable and that it would not extend the compliance date beyond the January 1, 2027 deadline.
CBN however surprised operators, when it said as a regulator, it also had some of its sensitive payments transaction data currently being hosted outside of Nigeria, but that it has commenced the process of migrating such data back to Nigeria, to be hosted locally in Nigeria.
CBN Directive/Warning
Four months after CBN issued a circular, directing all financial institutions and fintech companies to migrate their payments transaction data to Nigeria for local hosting, the financial sector regulator, last week in Lagos, reaffirmed its decision to begin the enforcement process to ensure full compliance of the directive. According to CBN, the January 1, 2027 deadline remains unchanged. The Director, Payments Systems Supervision Department, Central Bank of Nigeria (CBN), Dr. Rakiya Opemi Yusuf, said this in her welcome address, during the ‘CloudReady Nigeria Financial Services Roundtable’, organised by Africa Hyperscalers.
According to Yusuf, who was represented by the Assistant Director, Payments Systems Supervision Department at CBN, Mr. Babatunde Ajiboye, “Our task is to ensure proper implementation of the directive of the CBN for local data storage and management of payment transaction data into practical, reliable implementation. The CBN circular of June 15, 2026 requires payment transaction data generated within Nigeria to be stored and managed in Nigeria with full compliance set for 1st of January, 2027.”
Yusuf said: “The compliance date hasn’t changed. It’s 1st of January, 2027. So, while you go about your implementation, you must know that it has to address the full data lifecycle from creation through processing and storage to eventual disposal. This calls for a complete data audit. The practical sequence is to audit and classify the data, agree on the local architecture and contracts, then mitigate, test, and independently verify completion.”
CBN Surprise Move
The CBN has sent a shocker to all financial data processing companies that still host their data outside of Nigeria, when it threw the first shot on data localisation, as the financial regulator used itself as an example to drive home its message of compliance.
Speaking at a panel session during the ‘CloudReady Nigeria Financial Services Roundtable, moderated by the Chief Executive Officer, Open Access Data Centres (OADC), Dr. Ayotunde Coker, the Assistant Director, Payments Systems Supervision Department at CBN, Mr. Babatunde Ajiboye, said: “First, let me say that the Central Bank of Nigeria is not isolated to the circular that was released in June. Most of you will be well aware that CBN itself also has quite a lot of data, which are being hosted by partners that are not necessarily in Nigeria. So, the directive is not only for operators. It’s also for the regulator, and we have put in place, very stringent processes towards meeting a timeline that we have set for everyone else. So maybe from an expectation point of view, we expect that the same zeal and diligence that the CBN has put in as a regulator and also as an entity to abide by the tenets of that circular, is what other operators would want to put in place as well.”
According to Ajiboye, the CBN has heard quite a lot of comments from data operators in terms of being apprehensive, but some eager to comply. He however said such apprehension was a reflection of who their partners are, adding that there is nothing difficult to meet up with the deadline in terms of data migration.
“We are not unaware that in the process of migration, there will be a number of issues. But those issues can be dealt with on a case-by-case basis. That doesn’t mean there will be an extension to the deadline. The January 1, 2027 deadline is sacrosanct and will not be changed. And I believe the CBN has shown that in the last three years, that when it says something, it meant it. So, there won’t be any extension,” Ajiboye said, adding that CBN will not listen to excuses from operators who may fail to comply with the directive.
He further said that CBN would begin review of the directive by January 1, 2027, to see what the level of compliance will be.
Operator’s View Point
Speaking at a fireside chart moderated by the Executive Director, Africa Hyperscalers, Mr. Temitope Osunrinde, during the ‘CloudReady Nigeria Financial Services Roundtable’, the Chief Enterprise Business Officer, MTN Nigeria, Lynda Saint-Nwafor, stressed the need for competence and resilience of local data hosting companies to effectively accommodate sensitive data locally.
Addressing the issues of capability and competency within Nigeria, especially in addressing the expected influx of data localisation in Nigeria, she said: “From an MTN perspective, given our evolution into different aspects, we started out initially as a pure telecoms provider. So, we provided connectivity, but subsequently, we provided fintech services, alongside telecommunications services, and data services and we later moved into cloud services and of course we are moving into even systems integration because we believe that we are sitting in a small section of technology for everybody. Based on our expansion move, I can confidently say that MTN has the capacity and competence to manage and host data locally in Nigeria, and I say this with a sense of humility.”
According to her, MTN Nigeria has trained Nigerians to manage very complex engineering environments in MTN. “We have local experts, local engineers managing hundreds of terabytes of data on a daily basis. We have the infrastructure, with thousands of servers spread over 12 data centres in Nigeria, and these are managed by Nigerians,” Saint-Nwafor further said.
She advised Data Centre operators in Nigeria to open up the markets for what needs to come, insisting that the demand for local data hosting will increase, following the CBN’s directive.
The people who have already made the investments in Data Centre operations who have paid the price, should be given the opportunity to host data locally, based on capability and competence. Therefore, payments transaction data companies must believe in the local Data Centre operators that have the capacity and competence because there are two things that are required: Believing in the country, and believing in the markets. The first thing is the capacity to make the investment and the willingness to make that investment, Saint-Nwafor said.
She also stressed the need for scalability of local Data Centre operators in order to attract and maintain the supply ecosystem.
Operators’ Readiness
Speaking at the forum about the readiness of Data Centre operators to host data locally in the country, CEO, Open Access Data Centres, Ayotunde Coker, said OADC has the capability to host more data in its facilities.
According to him, OADC has attained the Payment Card Industry Data Security Standard (PCI DSS) certification, with the edge infrastructure and can combine all of these together to create an edge capability that enables interconnectivity.
“So, it’s not just what the CBN has directed, because the banks and enterprise financial services and other financial services companies, are our clients and we have to treat clients with discipline to enable them to deliver services to their end customers.
“So, we bring in efficient growth and scalable design, disciplined operations, smarter energy. We worry about all of that stuff. And so, we have this core-to-edge structure, the big data centres and the small data centres,” Coker said.
The Chief Operating Officer for Nobus Cloud, Stephen Okoye, who spoke during the fireside chat, said one of the key things that Nobus Cloud did differently was to build a platform with the same technology that’s being used by the hyperscalers today.
According to him, Nigeria is ahead of most African countries when it comes to skill set in cloud computing and Nobus Cloud is proud to be one of the few companies that are building that skill set.
“Today, we’ve not just built one in the data centres that we have. We now have three of such models running across Africa. Nobus Cloud is not just your typical cloud company selling a foreign technology. What we have, we own. The engineers that built our cloud infrastructure are in Nigeria. The engineers that manage them are also in Nigeria. From Nigeria to the rest of Africa, we are building skill sets, not just to deploy some of these things but to also maintain them going forward,” Okoye said.
CEO, Layer3, Oyaje Idoko, said beyond connectivity and cloud, Layer3 has helped banks and enterprise organisations to build their core network infrastructure.
“We are the most resilient core infrastructure company for some of the biggest banks in Nigeria in our past 20 years of existence, and about five years ago, we invested in Layer3 Cloud. So, it’s a platform that has been running over the past five years, running very mission-critical workloads across various sectors. So, as of today, we have built a robust cloud platform from ground up, 100 per cent locally built, deployed, and scaled over the past five years, and we provide services across four major pillars,” Idoko said.
“So, for a lot of our customers currently, be it the cloud customers or enterprise customers, most times, we are able to detect security intrusions of their network even before they realise that they have any sort of security issues. We can advise our customers and help them mitigate risk. So, we run a 24 by seven network operation centre in addition to our cyber security operation centre, which we are able to offer organisations.
“We’ve not gotten there yet, but we are building. We know that with time, as the workloads keep coming back to Nigeria, we will have data centres that can meet global standards, cloud services that will meet global standards, and we will have customers that will be happy because their clients are delivering value to them,” Idoko added.
Implementation Process
Executive Director, Africa Hyperscalers, Mr. Temitope Osunrinde, who addressed the issue of implementation of the CBN’s directive on data migration and localisation during his opening remarks, at the ‘CloudReady Nigeria Financial Services Roundtable’, said Nigeria had already established a clear direction towards sovereign cloud, adding that the concern now, is what it will take to implement the vision successfully across the financial sector.
Osunrinde however said the implementation would require clear guidelines, appropriate data and workload classification, including resilient infrastructure, trusted providers, and coordinated regulation.
“So, the objective of the forum is to move from policy to practical implementation. We want to identify what institutions must do, what providers must demonstrate, what further investment is required, and how the financial sector’s demand can support the growth of Nigeria’s cloud and data centre ecosystem,” Osunrinde said.
According to him, “We strongly believe that the directive of the CBN on data migration and localisation will significantly improve not just the digital infrastructure industry or the financial services industry, but all of Nigeria’s economy at scale.”