…As OADC foresees new wave of cloud investment in Nigeria
Nigeria’s push to force banks and fintechs to keep payment data within the country could soon spread to strategic sectors, including oil and gas, manufacturing, and government, while triggering a new wave of cloud and data centre investment.
This is even as the Open Access Data Centres (OADC) say the Central Bank of Nigeria’s latest data localisation directive marks the beginning of a broader shift toward sovereign digital infrastructure.
The Central Bank of Nigeria (CBN) recently directed financial institutions to localise payment-related data by January 1, 2027, a move aimed at strengthening data sovereignty and reducing reliance on overseas infrastructure.
Ayotunde Coker, chief executive officer of OADC, said the policy marks the culmination of more than a decade of investment in Nigeria’s digital infrastructure and should be viewed as the next stage in the country’s technology evolution rather than a sudden regulatory shift.
“In many ways, this has been a long time coming. Nigeria now has the infrastructure, connectivity, and cloud ecosystem to support this transition,” Coker said during a virtual media briefing.
The directive comes as banks and fintech companies increasingly depend on global cloud platforms such as Amazon Web Services, Microsoft Azure, and Google Cloud Platform to run payment applications and digital banking services. While those platforms have enabled rapid growth, much of the underlying data has historically been hosted outside Nigeria.
Coker said the new policy sends a clear signal that Nigeria is prioritising data sovereignty, a move he believes will encourage hyperscale cloud providers to deepen their investments in the country.
“It tells the world that Nigeria is serious about localisation. That will encourage global cloud providers to bring more of their infrastructure into Nigeria over time,” he said.
The policy is expected to strengthen Lagos’ position as one of Africa’s leading digital infrastructure hubs, second only to South Africa, where most hyperscale cloud investments have traditionally been concentrated.
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Infrastructure already in place
Industry concerns that Nigeria may lack sufficient infrastructure to absorb the migration are misplaced, according to Coker.
He said major operators, including OADC, Rack Centre, Equinix, Kasi Cloud and Digital Realty’s Medallion facility, already have available capacity, while several expansion projects are underway.
OADC itself is developing the second phase of its Lagos campus, increasing capacity to about 24 megawatts. The facility is also being designed to support artificial intelligence workloads through advanced cooling systems and high-density computing infrastructure.
“There is no capacity problem. The key players already have expansion plans in place. This isn’t a situation where we need to start looking for land or planning approvals,” Coker said.
He added that modern data centre expansion is phased, allowing operators to deploy additional capacity as demand grows without disrupting existing services.
Bigger opportunity than banking
Beyond banking, Coker believes the CBN directive could become the template for broader data localisation policies across sectors such as oil and gas, manufacturing and government services.
Nigeria’s energy industry, in particular, is undergoing rapid digital transformation, with increasing demand for cloud computing, artificial intelligence and real-time analytics.
He said localisation requirements for exploration data and other strategic information could emerge as the sector modernises.
Manufacturers also stand to benefit from hosting enterprise applications closer to their operations, reducing latency associated with systems currently hosted in Europe.
“The financial sector is only the beginning. Oil and gas, manufacturing and government are all moving towards greater digital transformation,”
Coker said.
Lower exposure to foreign exchange
One of the biggest economic implications of the policy could be reduced exposure to foreign exchange volatility.
Many Nigerian companies currently pay cloud hosting bills in US dollars. Local hosting would allow a greater share of those costs to be incurred in naira, reducing operational exposure to currency fluctuations while keeping more spending within the domestic economy.
Although migration itself will require investment, Coker argued that companies will benefit from lower currency risk over the long term.
He also said every new megawatt of data centre capacity generates significant economic activity through construction, engineering, electrical equipment, security services, power infrastructure and highly skilled employment.
According to him, the local supply chain supporting data centre development has expanded significantly over the past decade, with global engineering and equipment companies establishing stronger operations in Nigeria.
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Migration timeline
While some industry players have questioned whether the six-month implementation period is sufficient, Coker said organisations should focus on developing migration plans rather than debating the deadline.
“If a regulator gives you a deadline, you assess your architecture, identify the migration path and engage where genuine implementation challenges exist,” he said.
He acknowledged that each institution’s migration complexity will differ depending on equipment, software architecture and operational requirements, but said operators have already begun receiving enquiries from banks and fintech firms preparing for compliance.
Industry analysts say the CBN’s directive could become one of the biggest catalysts for Nigeria’s digital infrastructure market since the arrival of submarine internet cables more than a decade ago.
If successful, the policy could accelerate domestic cloud adoption, attract fresh international investment and strengthen Nigeria’s ambition to become West Africa’s dominant digital economy while keeping more critical financial data within its borders.
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