CBN orders local storage of payment data, moves to curb market dominance

The Central Bank of Nigeria (CBN) has directed banks, fintech companies and other payment operators to store all payment transaction data generated in Nigeria within the country, while also introducing new measures aimed at curbing market dominance in the financial technology sector.

 

The directive was contained in a circular dated June 15, 2026, titled “Introduction of Market Structure Requirements, Data Localisation, Ultimate Beneficial Ownership Disclosure, and Systemic Oversight Measures in the Nigeria Payments System.”

 

According to the apex bank, all financial institutions and payment system participants must ensure that transaction data generated in Nigeria are stored and managed within the country in line with applicable data protection laws.

 

It stated that full compliance with the data localisation requirement will take effect from January 1, 2027.

 

On ownership transparency, the CBN mandated banks and payment service providers to disclose the ultimate beneficial ownership of significant shareholders in accordance with anti-money laundering and counter-terrorism financing regulations.

 

It added that institutions must maintain accurate and updated ownership records and make them available to the apex bank upon request.

 

The CBN said the new framework was necessary due to the rapid growth of digital financial services and the increasing influence of dominant players in the payments ecosystem.

 

To address concerns over market concentration, the bank introduced limits on cross-market dominance, stating that any operator with more than 25 per cent market share in card issuing must not hold more than 15 per cent in merchant acquiring, and vice versa.

 

The apex bank also directed all regulated entities to submit monthly market share reports and achieve full compliance with the new requirements by December 31, 2026.