Open Banking in Nigeria

Nigeria is the first major African economy to establish a comprehensive regulatory framework for open banking. The Central Bank of Nigeria (CBN) published its Regulatory Framework for Open Banking in 2021 after extensive stakeholder consultations that began in 2017. This framework positions Nigeria as a leader in Africa's open banking evolution.

The Nigerian approach uses a tiered data-sharing model with four categories: product information (lowest sensitivity), customer information aggregation, customer transaction data, and payment initiation (highest sensitivity). Each tier has progressively stricter requirements for participant registration, consent management, security controls, and regulatory oversight. This tiered approach allows for gradual ecosystem development while managing risk.

The framework establishes roles for API providers (banks and other financial institutions), API consumers (fintechs and third-party providers), and intermediaries (technical service providers). It requires compliance with data protection regulations, including the Nigeria Data Protection Regulation (NDPR), and mandates Strong Customer Authentication for data access.

Nigeria's open banking initiative operates within a dynamic fintech ecosystem. The country has one of Africa's most vibrant fintech sectors, with players like Flutterwave, Paystack, and Kuda already building services that will benefit from standardized API access. The framework builds on existing Payment Service Bank (PSB) and Mobile Money Operator licenses that have expanded financial access.

Challenges include varying levels of technical readiness among banks, infrastructure constraints in connectivity and uptime, and the need for consumer education about data rights and consent. However, Nigeria's large population, high mobile phone penetration, and innovative fintech ecosystem provide a strong foundation for open banking adoption. The CBN continues to work with industry stakeholders to develop detailed technical specifications and an operational governance model.