The Central Bank of Nigeria (CBN) says it will consider financial institutions’ challenges in meeting the January 2027 data-localisation deadline, as a survey shows gaps in implementation readiness across the sector.
Dr Rakiya Yusuf, Director, Payments System Supervision Department, CBN, gave the assurance at an Executive Regulatory Dialogue on the National Sovereign Cloud Initiative and Data Localisation Implementation in Lagos on Wednesday.
Yusuf said the apex bank was prioritising engagement and guidance to help institutions comply with its June 15 circular requiring payment transaction data generated in Nigeria to be stored and managed within the country.
She urged institutions experiencing difficulties to write to the Payments System Supervision Department, stating their challenges and proposed compliance plans for consideration on a case-by-case basis.
She said the CBN would use feedback from the dialogue to develop further guidance, including frequently asked questions, to clarify the requirements.
Yusuf, however, warned that deliberate attempts to frustrate compliance could attract sanctions.
The need for regulatory engagement comes as a survey presented by the National Information Technology Development Agency (NITDA) showed that 22 of 44 financial institutions surveyed had yet to begin implementing measures to meet the Jan. 1, 2027 deadline.
Dr Muhammad Lawal, Special Assistant to the NITDA Director-General on Policy, who presented the findings, said 26 institutions expected to complete implementation by the deadline, while 15 considered completion unlikely or very unlikely.
He said three others could not assess their readiness.
The survey also showed that 70 per cent of the institutions had identified relevant data and systems, 23 per cent had engaged local service providers, and 25 per cent had obtained board approval.
Only 18 per cent had begun migration or remediation activities.
Lawal said uncertainty over the scope of payment transaction data and the meaning of data being stored and managed in Nigeria remained major concerns.
The survey received responses from 47 financial institutions and 42 digital infrastructure providers, although the number of responses varied across individual questions.
The findings were self-reported, anonymised and aggregated, and did not constitute a formal regulatory compliance assessment.
In his keynote address, CBN Deputy Governor, Financial System Stability, Dr Lamido Yuguda, said cloud computing offered opportunities to improve efficiency, scalability and innovation but also introduced risks relating to cybersecurity, operational resilience, data protection and dependence on third-party technology providers.
He cautioned that data localisation alone would not guarantee security, stressing that financial institutions remained responsible for managing risks associated with their cloud service providers.
Yuguda called for a balanced and collaborative implementation approach that would strengthen financial system resilience without unnecessarily constraining innovation or isolating Nigeria from global technology.
CBN Deputy Director and Head of Information Technology Infrastructure Management Division, Dr Alexander Akinsowon, also highlighted the risks of relying on offshore infrastructure, citing disruptions caused by submarine cable outages in 2024, which affected connectivity and took time to resolve.
Meanwhile, the survey indicated that 79 per cent of digital infrastructure providers were ready to accommodate financial-sector workloads, while 74 per cent said they could onboard new customers within three months.
Mr Ikechukwu Nnamani, Managing Director of Digital Realty Nigeria, said local infrastructure providers were positioned to support the transition, but sustained investment would be required to expand capacity.
He said a typical megawatt-scale data-centre facility could cost between 12 million dollars and 15 million dollars to develop and take two to three years to build.
Mr Olugbenga Paseda, Governing Council Member of the Fintech Association of Nigeria and Chief Executive Officer of Chrisborough, said fintech companies faced particular challenges because many relied on global cloud providers.
He identified costs, power supply, connectivity, security and uncertainty over regulatory requirements as issues requiring attention to support implementation.
Paul Adigu, Director of Cloud Ecosystem at Huawei Cloud, said organisations needed to assess their readiness, map their services and establish clear responsibilities and migration timelines to support an orderly transition.
A representative of the Nigerian Data Protection Commission stressed that personal data protection obligations remained important regardless of where data was hosted, while cross-border transfers had to comply with applicable legal safeguards.
The dialogue brought together regulators, financial institutions, fintech operators and technology providers to address implementation challenges and identify practical measures ahead of the January 2027 deadline.
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