Central Bank of Nigeria Mandates Data Localization and Market Caps

The Central Bank of Nigeria issued a regulatory circular on June 15, 2026, introducing strict data localization and market structure requirements for banks, fintech firms, and payment service providers. The directive mandates that all payment transaction data generated within Nigeria be stored and managed on domestic servers, with a full compliance deadline of January 1, 2027.

To reduce concentration risk and prevent excessive market dominance, the regulator established new caps on industry share. Institutions holding more than 25% of the market in card issuing are prohibited from holding more than 15% in merchant acquiring, and vice versa. Regulated entities must submit monthly market share returns and align their operations with these structure requirements by December 31, 2026.

Additionally, the bank now requires the disclosure of Ultimate Beneficial Ownership for significant shareholders to improve transparency and combat money laundering and terrorism financing. While the data localization mandate is set for January 2027, some reports describe the directive as a six-month ultimatum, noting that non-compliance could result in fines or the suspension of operating licenses.