The Central Bank of Nigeria (CBN) has told financial institutions that they bear responsibility for managing risks associated with their growing reliance on cloud computing and third-party technology providers.
The Deputy Governor, Financial System Stability at the apex bank, Lamido Yuguda, stated this in Lagos, on Wednesday, at the CBN-National Information Technology Development Agency (NITDA) Executive Regulatory Dialogue on the implementation of the National Sovereign Cloud Initiative (NSCI) and data localization scheduled for commencement on January 1 2027.
He said that while cloud computing offers scalability, efficiency, flexibility and opportunities for innovation, its growing adoption raises concerns about cybersecurity, operational resilience, data protection and dependence on third-party providers.
Yuguda said: “Cloud computing has become an important enabler of this transformation, offering scalability, efficiency, flexibility, and opportunities for innovation. However, increased reliance on cloud and digital infrastructure also brings important considerations around cybersecurity, operational resilience, data protection, third-party dependencies, and regulatory oversight.”
He also highlighted factors such as concentration risks, infrastructure readiness and effective oversight of technology providers as issues that should be addressed in ensuring successful implementation of the National Sovereign Cloud Initiative.
Specifically, he said that regulated institutions were expected to ensure that critical payment transaction data was stored and managed within Nigeria in accordance with applicable regulatory requirements and the January 1, 2027 implementation timeline.
He, however, stressed that keeping data within the country would not automatically guarantee security.
As he put it: “Localisation alone does not guarantee security. Financial institutions and their critical technology providers must maintain robust cybersecurity, business continuity, disaster recovery, and risk-management arrangements to ensure that critical financial services remain secure and available.”
The Deputy Governor said the apex bank will continue to work closely with NITDA and other relevant stakeholders to boost coordination between financial-sector requirements and national digital infrastructure standards, noting that, “no single institution can achieve these objectives in isolation.”
On the NSCI, he said the initiative would strengthen Nigeria’s digital resilience and domestic technological capacity without restricting innovation or isolating the country from global technological developments.
“The objective of the National Sovereign Cloud Initiative should not be to constrain innovation or isolate Nigeria from global technological developments. Rather, it should provide the security, resilience, and regulatory certainty necessary to support investment, innovation, and sustainable growth,” he said.
Also speaking at the event, the Director of the Payments Systems Supervision Department at the CBN, Dr. Rakiya Opemi Yusuf, said the apex bank and NITDA decided to organise the event in order to provide clarity on the objectives of the NSCI and to urge every stakeholder to realize that, “we all need to come together to ensure that 1st of January 2027 is a reality.”
“We’re looking forward that by 1st of January 2027 that everyone will be on board to have payments data localized. Because it’s about our sovereignty, it’s about clarity, it’s about visibility over our transaction data. And it’s about ensuring financial system stability, which is the mandate of the CBN,” she added.
Earlier, the Director-General and Chief Executive Officer of NITDA, Kashifu Abdullahi, said Nigeria needed greater control over the digital infrastructure on which its economy and financial system depended to protect essential services from external disruptions.
Abdullahi said the initiative was intended to strengthen Nigeria’s capacity to deliver essential digital services without excessive dependence on external infrastructure, adding that digital sovereignty did not mean isolation or building every technology locally.
He said NITDA and the CBN were working together to make the financial sector the first to comply with the national sovereign cloud initiative, while encouraging collaboration among financial institutions, telecommunications companies, technology providers and the wider innovation ecosystem.