Nigeria’s payments industry is set for a major shake-up. The Central Bank of Nigeria (CBN) has unveiled new rules that will require banks, fintech firms and other payment service providers to keep all payment transaction data within the country, while also tightening competition and ownership disclosure requirements across the sector.

The Central Bank of Nigeria (CBN) has directed banks, fintech companies and other players in the country's payments ecosystem to ensure that all payment transaction data generated in Nigeria is stored and managed locally.

The directive was contained in a new circular issued to Deposit Money Banks, Microfinance Banks, Mobile Money Operators, Switching and Processing Companies, Payment Terminal Service Providers, Payment Solution Service Providers, Super Agents and other licensed operators.

Signed by the Director of the CBN’s Payments System Supervision Department, Rakiya Yusuf, the circular introduces fresh requirements aimed at strengthening oversight, improving transparency and promoting healthy competition within Nigeria’s rapidly growing digital payments sector.

According to the apex bank, the move comes in response to the remarkable growth of electronic payments and digital financial services across the country. While that growth has driven innovation, efficiency and greater financial inclusion, the regulator says it has also raised concerns around market concentration, operational dependence, ownership transparency and the handling of sensitive payment data.

To address these concerns, the CBN says the new measures are designed to improve transparency through beneficial ownership disclosures, reduce concentration risks, encourage fair competition and strengthen the resilience of Nigeria’s payments ecosystem.

One of the most significant provisions requires all financial institutions and payment service providers operating in Nigeria to store and manage payment transaction data within the country, in line with Nigerian data protection laws and regulations.

The CBN stated that all institutions facilitating payments in Nigeria must ensure that transaction data generated within the country remains stored and managed locally.

The regulator also directed institutions to maintain accurate and up-to-date records of their Ultimate Beneficial Owners (UBOs) and make such information available whenever requested by the CBN.

In a bid to prevent excessive market dominance, the apex bank has also introduced new competition rules. Under the framework, any institution controlling more than 25 per cent of the card-issuing market over a rolling 12-month period will not be allowed to hold more than 15 per cent of the merchant-acquiring market during the same period.

Similarly, operators with more than 25 per cent market share in merchant-acquiring services will be restricted to a maximum of 15 per cent share in card-issuing activities.

To ensure compliance, all regulated entities must submit monthly market share reports using the templates and timelines prescribed by the CBN.

Affected institutions have until 31 December 2026 to fully comply with the new market structure requirements, effectively positioning the industry for full implementation by 2027.

The CBN warned that it will closely monitor compliance and may impose supervisory sanctions on any institution that fails to adhere to the provisions of the circular.

The latest directive signals the regulator’s determination to strengthen Nigeria’s digital payments infrastructure, improve data sovereignty and ensure a more competitive and transparent financial services landscape.

Source: cbinewstv

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