The Association of Licensed Telecommunications Operators of Nigeria (ALTON) has backed the Central Bank of Nigeria’s directive requiring local hosting of payment transaction data, saying the move will help banks and fintech companies reduce their exposure to foreign exchange volatility and lower long-term operating costs.
ALTON Chairman, Gbenga Adebayo, made the remarks in an interview with the News Agency of Nigeria in Lagos on Saturday.
Under the directive, banks, fintechs and other payment service providers are required to store payment transaction data generated in Nigeria on local servers from January 1, 2027. The policy forms part of broader efforts by the Central Bank of Nigeria to strengthen oversight of the country’s rapidly expanding digital payments ecosystem.
Adebayo said local data hosting would allow financial institutions to pay for data infrastructure services in naira rather than foreign currencies, reducing their vulnerability to exchange rate fluctuations.
“Organisations hosting data locally would pay in local currency rather than foreign exchange. This would help reduce exposure to exchange rate pressures and lower long-term operating costs,” he said.
He added that the benefits of local hosting extend beyond cost savings, describing it as an important component of national data sovereignty.
According to him, countries should take responsibility for the collection, management, storage and protection of their data rather than relying on foreign jurisdictions.
“We cannot continue to outsource that to other jurisdictions. The more we host our data locally, the better for us,” Adebayo said.
He also noted that storing data abroad can create operational inefficiencies, as transactions must be routed through foreign servers before returning to Nigeria.
“For every transaction involving data hosted outside our shores, communication has to take place from your location to the host and back. It increases latency and also increases the cost of data retrieval,” he said.
On cybersecurity, Adebayo argued that local control of data provides stronger protection than relying on external service providers.
“No one can protect your house better than yourself. You have more at stake in terms of security and safety than somebody else hosting your data,” he said.
Addressing concerns about Nigeria’s readiness for the transition, Adebayo said the country already possesses sufficient data centre capacity to support the directive.
He pointed to the presence of several Tier III data centres in Nigeria, noting that some already host data for international clients.
“I’m happy to say that we have a lot of data centres owned and managed by Nigerians that are hosting data from other jurisdictions. If people overseas can host their data here, why can’t we host our own data here?” he said.
According to him, capacity rather than the number of facilities is the key consideration, adding that Nigeria’s existing infrastructure is capable of supporting local data hosting requirements.
