The Central Bank of Nigeria (CBN) has introduced a fresh set of regulations aimed at strengthening oversight, enhancing transparency, and promoting fair competition within the country’s payment ecosystem.
Under the new directives, all banks, fintech firms, payment service providers, and other financial institutions processing transactions in Nigeria must ensure that payment transaction data generated within the country is stored and managed locally.
The new policy was outlined 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 Nigerian Payments System.”
According to the apex bank, the data localisation requirement aligns with existing Nigerian data protection laws and will become fully effective from January 1, 2027.
In addition, the CBN has mandated financial institutions with digital payment operations to disclose the Ultimate Beneficial Owners (UBOs) of significant shareholders. The move is intended to boost transparency and strengthen compliance with anti-money laundering, counter-terrorism financing, and counter-proliferation financing regulations.
Affected institutions have also been directed to maintain accurate and updated records of their beneficial owners and make such information available to the regulator whenever requested.
The CBN explained that the rapid expansion of Nigeria’s digital payments sector, driven by increased adoption of electronic transactions and digital financial services, has created new regulatory challenges, including concerns over market dominance, ownership transparency, operational dependence, and the management of critical payment data.
To address these concerns, the regulator introduced new market structure rules targeting card issuers and merchant acquirers.
Under the guidelines, any licensed financial institution controlling more than 25 per cent of the card issuing market will be restricted to a maximum of 15 per cent share in merchant acquiring activities. Likewise, institutions holding over 25 per cent of the merchant acquiring market will be limited to 15 per cent participation in card issuing operations.
The CBN said the measures are designed to curb excessive market concentration and encourage healthy competition across the payments industry.
As part of the enhanced oversight framework, regulated entities will also be required to submit monthly market share reports, enabling the apex bank to monitor industry trends and identify institutions whose operations may pose systemic risks.
The regulator directed all affected institutions to achieve full compliance with the new market structure requirements by December 31, 2026.
The regulations are expected to have significant implications for banks, fintech companies, payment service providers, and other stakeholders operating in Nigeria’s rapidly expanding digital payments landscape.
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