OADC: CBN’s Directive on Data Localisation Will Attract Foreign Investments

Emma Okonji

The Chief Executive Officer of Open Access Data Centres, Ayotunde Coker, has said the directive given by the Central Bank of Nigeria (CBN), mandating all financial institutions to host their data locally in Nigeria with effect from January 1, 2027, will attract foreign direct investments to Nigeria.

According to him, the directive, if fully implemented, will send strong signals to foreign cloud providers that host Nigerian data abroad that they’re going to be losing their Nigerian customers, if they don’t invest in Nigeria and if they refuse to partner with established local cloud providers in Nigeria.    

Coker said this in Lagos, while reacting to trending issues making the rounds that financial institutions, whose data are already domiciled and hosted abroad, may decide to return a fraction of their data to Nigeria in the name of compliance, but still host the bulk of their data outside Nigeria.

He advised banks and other institutions that still host their data outside of Nigeria, to begin to work out the processes and risks that are associated with the CBN directive, and to seek clarification from experts where necessary in order to have a seamless compliance process. 

According to him, banks and financial institutions run their core banking applications and sensitive data on clouds that are hosted outside the shores of Nigeria, adding that some local cloud providers also host Nigeria’s data on

AWS Cloud or Microsoft Cloud or Google Cloud, or Oracle Cloud platforms that are domiciled in the United States of America, United Kingdom and other countries outside Nigeria.

He said such foreign hosting negates Nigeria’s sovereignty with grave security implications, which the Nigerian Data Protection Act is against.