NITDA, CBN advance national sovereign cloud initiative to strengthen Nigeria’s digital sovereignty

The National Information Technology Development Agency (NITDA) and the Central Bank of Nigeria (CBN) have reaffirmed their commitment to strengthening Nigeria’s digital sovereignty through the National Sovereign Cloud Initiative (NSCI) and data localisation, with the financial sector expected to lead implementation ahead of the January 1, 2027, deadline for critical payment transaction data.

The initiative seeks to strengthen Nigeria’s control over the digital infrastructure supporting essential services, improve cybersecurity and operational resilience, and reduce exposure to external disruptions, geopolitical risks and excessive dependence on individual technology vendors.

NITDA Director-General, Kashifu Inuwa Abdullahi, outlined the agency’s position at an Executive Regulatory Dialogue organised by NITDA in partnership with the CBN in Lekki, Lagos State.

The engagement brought together stakeholders from financial services, telecommunications, data centres and the wider technology industry to discuss the policy, infrastructure and regulatory requirements for building a more resilient, Nigeria-based digital ecosystem.

Abdullahi said digital sovereignty had become a critical national priority as Nigeria’s economy increasingly depended on digital platforms and infrastructure, particularly for financial transactions and other essential services.

He challenged stakeholders to consider the economic consequences of disruptions affecting critical digital infrastructure hosted outside Nigeria.

“Imagine what will happen to our economy if tomorrow a major disruption or geopolitical crisis prevents our banks from accessing critical digital infrastructure hosted outside our country. Can our citizens still transfer money? Can businesses still receive payments? Can our banks keep processing transactions? Can our economy continue functioning?” he asked.

According to him, the implications extend beyond technology to national economic security, financial stability and Nigeria’s ability to maintain control over its digital future.

The NITDA chief clarified, however, that digital sovereignty should not be interpreted as technological isolation or an attempt to develop every technology locally.

Rather, he said, it involves building the national capacity to make informed decisions about the technologies, infrastructure, standards and service providers on which the country depends.

“Digital sovereignty is not about politics. It is not about isolation. It is not about building everything ourselves, but it is about building our digital capacity to compete in the world we are today,” Abdullahi stated.

Abdullahi cited Nigeria’s financial services industry as an example of how deliberate policy decisions can stimulate technological innovation and strengthen local capabilities.

He recalled that the CBN’s cashless policy encouraged financial institutions to upgrade their technology infrastructure, creating opportunities for fintech companies to develop innovative products and services and contributing to Nigeria’s emergence as a major fintech ecosystem.

He commended the apex bank for taking further steps to strengthen control over the infrastructure underpinning financial services, expressing confidence that the sector could again lead the country’s digital transformation.

“Through this partnership, NITDA and CBN are working together to make sure the financial sector is the first sector to comply with our National Sovereign Cloud Initiative,” he said.

Abdullahi explained that NITDA would provide the standards and overarching policy framework that sector-specific regulators could apply in advancing digital transformation within their respective industries.

He stressed that implementation would require coordinated participation from financial institutions, telecommunications operators, data centre providers, system integrators, technology companies and global cloud service providers.

According to him, Nigeria is building on existing domestic capabilities and international experience rather than starting from scratch.

“We have done it before, and we are going to do it now. So this is not something you can doubt; it is something that already exists,” he said, urging stakeholders to work together to achieve the initiative’s objectives.

To support implementation, Abdullahi disclosed that NITDA would develop an assurance framework drawing on existing international certification standards while ensuring compliance with Nigeria’s national sovereign architecture requirements.

He added that the agency was also exploring national certification options to provide greater flexibility and choice for organisations seeking to comply with the framework.

He identified control, independence, resilience, risk management and freedom of choice as fundamental principles of digital sovereignty.

According to him, Nigeria must be able to maintain essential digital services during external disruptions, reduce exposure to geopolitical and technology-related risks, and avoid excessive dependence on individual vendors or jurisdictions.

Abdullahi also emphasised the importance of building resilient infrastructure capable of sustaining critical financial operations during disruptions to international connectivity.

“Submarine cable disruption cannot automatically affect our payment system,” he said.

The initiative is also intended to reduce vendor lock-in by giving organisations greater flexibility in choosing technologies and infrastructure that serve their operational needs and national interests.

In his keynote address, CBN Deputy Governor, Financial System Stability, Mr Lamido Abubakar Yuguda, reaffirmed the bank’s commitment to strengthening financial stability, cybersecurity and the protection of critical financial data through the National Sovereign Cloud Initiative and data localisation.

Yuguda commended NITDA for its leadership in advancing Nigeria’s digital transformation agenda, noting that the rapid growth of digital payments, fintech, mobile money and digital banking had increased the financial sector’s dependence on digital infrastructure.

He said financial institutions must strengthen cybersecurity, business continuity, disaster recovery and risk management arrangements while complying with applicable data localisation requirements.

He also highlighted the January 1, 2027, implementation timeline for critical payment transaction data, underscoring the need for institutions to prepare for the transition.

The CBN deputy governor stressed that the initiative should encourage innovation rather than isolate Nigeria from global technological developments. He called for stronger collaboration among regulators, financial institutions and technology providers to ensure that implementation supports both security and competitiveness.

“Our collective objective should be clear: to build a digital financial ecosystem that is innovative without compromising security, sovereign without becoming isolated and resilient enough to sustain public confidence,” Yuguda stated.

Presenting findings from a pre-event survey, Dr Muhammad Aminu Lawal, Special Assistant to the NITDA Director-General on Policy, said regulatory clarity, migration timelines and local infrastructure capacity were among the critical issues requiring urgent attention ahead of the 2027 deadline.

The survey indicated that Nigeria already had some capacity to accommodate early adopters of the initiative.

According to Lawal, 79 per cent of the 42 digital infrastructure and service providers surveyed reported that they were ready to accommodate additional financial-sector workloads. Meanwhile, 74 per cent said they could onboard new financial customers within three months.

The findings suggest that a segment of the domestic digital infrastructure market is positioned to support the transition, although broader readiness will depend on the requirements of individual financial institutions and the capacity of providers to meet applicable assurance and compliance standards.

Lawal disclosed that much of the planned infrastructure expansion was expected in 2027, potentially creating timing challenges for organisations preparing to meet the deadline.

The survey also identified financing costs, electricity supply and foreign exchange as major constraints affecting infrastructure development.

These challenges highlight the importance of aligning regulatory timelines with the practical requirements of migration, investment and the expansion of reliable local hosting capacity.

Based on the survey findings, Lawal called for clear written regulatory guidance, phased or risk-based implementation milestones, a defined process for exceptions and verifiable information on local infrastructure providers that meet the required assurance standards.

These measures would help financial institutions understand their compliance obligations, assess suitable providers and develop realistic migration plans.

Clear guidance would also help domestic infrastructure operators plan investments, improve capacity and demonstrate that their services meet the technical, security and operational requirements of the sovereign cloud framework.

For NITDA and the CBN, the immediate challenge is to translate policy objectives into practical implementation arrangements that provide certainty for financial institutions and infrastructure providers without compromising security.

Lawal concluded that coordinated action by NITDA, the CBN and industry stakeholders would be essential to resolving implementation uncertainties, strengthening local digital infrastructure and supporting a smooth transition to Nigeria-based data hosting and management.

The National Sovereign Cloud Initiative represents a broader effort to strengthen Nigeria’s ability to manage the digital infrastructure supporting its economy while retaining access to global technology and expertise.

Its success will depend on more than the location of data. It will also require effective governance, strong security controls, reliable electricity, resilient connectivity, skilled professionals, credible assurance mechanisms and clear responsibilities for service continuity.

The survey findings point to an encouraging level of reported readiness among some domestic providers, but also expose constraints that could affect the pace and cost of implementation.

As the January 1, 2027, deadline approaches, cooperation between regulators, financial institutions and infrastructure providers will be crucial to ensuring that data localisation strengthens financial resilience, supports local technology investment and preserves confidence in Nigeria’s increasingly digital economy.

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