CBN’s Data Localisation Mandate Spurs Data Centre Readiness and Local Manufacturing Ambitions
Nigeria’s financial sector is poised for a significant transformation as the Central Bank of Nigeria (CBN) directive mandating the local hosting of payment transaction data takes effect from January 1st, 2027. This regulatory imperative, aimed at enhancing data sovereignty and strengthening oversight, is already galvanising the nation’s data centre infrastructure and fostering ambitious plans for local technology manufacturing.
Ayotunde Coker, managing director of Open Access Data Centres, has reaffirmed the substantial capacity and world-class infrastructure available within Nigeria’s key data centres to meet this demand. Speaking at a media interactive session, Coker highlighted the readiness of facilities like Open Access Data Centres to effectively host the sensitive financial sector data. “As far as readiness is concerned, we have the co-location base, the co-infrastructure basis, and interconnection capability,” Coker stated, underscoring the robust foundational elements in place. He further noted the burgeoning ecosystem of indigenous cloud providers, such as Unicloud Africa and Layer 3, who are actively building out cloud capabilities within these data centres to serve local companies.
The CBN directive, signed by Rakiya Yusuf, Director of the Payments System Supervision Department, is seen as a clear signal of Nigeria’s commitment to data sovereignty and localisation. This move is anticipated to encourage global cloud providers to scale their operations within Nigeria, thereby bolstering the nation’s digital infrastructure. The reforms, which also introduce new market structure rules, beneficial ownership disclosure requirements, and systemic oversight measures, are a direct response to the rapid expansion of electronic payments and digital financial services. The CBN observed significant structural developments, including rapid growth in electronic payments and increasing adoption of digital financial services, which, while fostering innovation and financial inclusion, have also raised concerns around market concentration, operational dependence, ownership transparency, and the storage of critical payments data. Consequently, all financial institutions facilitating payments in Nigeria are mandated to ensure that transaction data generated within the country is stored and managed domestically, in compliance with applicable data protection laws and regulations.
In parallel, the Association of Licensed Telecommunications Operators of Nigeria (ALTON) has declared its strong support for the Nigerian Communications Commission’s (NCC) initiative to promote local smartphone manufacturing. Gbenga Adebayo, chairman of ALTON, described the move as a practical measure that will accelerate broadband adoption and expand digital inclusion. Adebayo emphasised the need for Nigeria to transition from being a technology consumer to a producer, innovator, and designer. He pointed to the country’s large telecommunications market and youthful population as critical assets for supporting world-class manufacturing.
Adebayo articulated that Nigeria’s manufacturing ambitions should extend beyond mere assembly of imported components, advocating for genuine knowledge transfer, research and development, product engineering, software development, semiconductor capabilities, and large-scale manufacturing. The ultimate goal, he stated, should be the production of devices and digital technologies for Nigeria, Africa, and the global market. The emergence of artificial intelligence, Adebayo added, presents a significant opportunity for Nigeria to become a competitive technology manufacturing hub, as AI is transforming product design, manufacturing, quality assurance, supply chain management, customer experience, and software innovation. Investments in AI-enabled manufacturing are expected to enhance productivity, create high-value jobs, and strengthen Nigeria’s competitiveness across Africa.
Addressing the challenge of counterfeit and non-type-approved devices, Adebayo identified the grey market as a significant impediment to consumers, original equipment manufacturers, and the broader telecommunications ecosystem. He posited that robust local manufacturing, underpinned by strong quality standards, would offer credible alternatives to grey-market imports, thereby strengthening consumer protection, improving network performance, retaining economic value within the country, and stimulating industrial growth. ALTON also endorsed innovative smartphone financing models, improved device management systems, and identity-enabled credit frameworks to enhance smartphone affordability for more Nigerians.
The NCC, through its Governing Board Chairman, Chief Idris Ibikunle Olorunnimbe, has also announced a high-stakes opportunity for international tech investors. The Nigerian government is offering direct presidential intervention and sweeping economic waivers for hardware companies that establish their manufacturing hubs in Nigeria by November 2026. Olorunnimbe stated that the government is committed to supporting these new factories, viewing them as crucial for economic growth, youth employment, and making mobile devices more accessible to the average Nigerian. This initiative is designed to stimulate immediate foreign direct investment and create sustainable employment.
The economic rationale behind this regulatory push is to anchor device pricing to the local currency, mitigating the volatility associated with foreign-exchange swings and import duties that currently make formal devices unaffordable for many. Olorunnimbe underscored the administration’s commitment, framing connectivity infrastructure as a central engine of President Tinubu’s Renewed Hope agenda, treating connectivity as productive infrastructure for the entire economy. This infrastructural push is intended to directly support the NCC’s initiative to transition Nigeria towards digital free education through the zero-rating of educational portals, aligning with the philosophy that access to educational resources should not be hindered by data costs. The proposed locally assembled smartphones, MiFi units, and home routers are expected to be integral to operationalising this vision.
