Nigeria’s fintech sector stands at a defining moment. As the Central Bank of Nigeria (CBN) rolls out sweeping reforms aimed at strengthening the country’s payment ecosystem, industry stakeholders are weighing the opportunities against the challenges. At the centre of the conversation is the regulator’s new market structure framework, designed to address concerns around market concentration, operational dependence, ownership transfers and data sovereignty in one of Africa’s fastest-growing digital economies.
For Pelumi Esho, Founder and CEO of 91 Payments, the reforms are not merely another round of regulation; they represent a necessary evolution for a market that has grown at extraordinary speed. Speaking on the implications of the new framework, Esho argues that stronger oversight is essential if Nigeria is to sustain its leadership position in digital payments and build greater trust among global investors.
Nigeria already occupies a unique position on the continent. According to Esho, the country processed over ₦1.2 quadrillion in instant payment transactions in 2025 alone, representing roughly 70 percent growth compared to previous years. With transaction volumes projected to continue expanding at more than 20 percent annually, he believes tighter regulation is both inevitable and necessary.
“As the ecosystem grows exponentially, regulation must evolve alongside it,” Esho explains. “Improved oversight not only protects consumers but also strengthens confidence in the financial system. For a country with over 240 million people, safeguarding the integrity of the payment ecosystem is critical.”
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While some industry observers fear the reforms could introduce new bottlenecks for cross-border transactions and capital flows, Esho sees the opposite outcome. In his view, the measures send a strong signal to international investors and financial institutions that Nigeria is committed to global compliance standards.
He points to Nigeria’s recent removal from the Financial Action Task Force (FATF) grey list as evidence of the country’s progress in strengthening anti-money laundering controls and improving financial transparency. For Esho, the latest reforms build on that momentum.
“Greater transparency and stronger compliance frameworks create confidence,” he says. “When global institutions can easily access reliable data through the appropriate regulatory channels, it becomes easier for them to invest and do business in Nigeria. That ultimately supports capital inflows rather than discouraging them.”
One of the most closely watched aspects of the new framework is the requirement that all payment transaction data generated within Nigeria be stored locally by January 2027. The policy reflects the regulator’s determination to strengthen data sovereignty and ensure easier access to information for oversight and investigative purposes.
Esho supports the principle behind the policy but acknowledges that implementation may present challenges. The success of data localisation, he argues, will depend heavily on the readiness of local infrastructure providers.
“The objective is clear: improve oversight and ensure easier access to transaction data when necessary,” he notes. “However, questions remain about whether local data centres have the resilience, connectivity and power infrastructure required to manage the scale of information that will be transferred.”
For fintech companies, compliance will not come without costs. Esho reveals that firms are already preparing for the transition by hiring additional data engineers, investing in technical resources and redesigning internal compliance frameworks to align with local requirements.
The additional burden, however, is unlikely to be passed directly to consumers. Recent regulatory directives require transaction charges to be transparent and disclosed upfront, meaning operators will largely absorb the cost of compliance themselves.
“Financial institutions will have to bear much of the implementation cost,” Esho explains. “Consumers are unlikely to see direct fee increases as a result of these changes.”
Beyond regulation, the conversation inevitably turns to financial inclusion—one of Nigeria’s most significant fintech success stories. Over the past decade, digital payments have transformed the everyday lives of millions of Nigerians, bringing financial services closer to individuals and businesses that previously operated largely outside the formal banking system.
Esho points to the remarkable shift in consumer behaviour. Where cash once dominated everyday transactions, digital payments have become commonplace even among small traders and roadside vendors.
“Five years ago, if you wanted to buy food from a local seller, cash was often the only option,” he says. “Today, many traders accept transfers, POS payments, QR codes and other digital payment methods. Financial inclusion has grown dramatically, and innovation has made electronic payments much more accessible.”
The rise of stablecoins presents another layer of complexity within the evolving payments landscape. Nigeria remains one of the world’s most active markets for digital assets, with billions of dollars flowing through stablecoin channels annually.
Yet Esho does not believe the new regulations will accelerate migration away from traditional payment rails. Instead, he argues that recent policy measures have helped stabilise the broader financial environment, particularly through improved exchange rate management.
“Stablecoins clearly have a role to play and their use cases are undeniable,” he says. “But recent reforms have also reduced friction within the conventional financial system. Exchange rate stability gives businesses greater confidence in planning and forecasting, which strengthens the overall ecosystem.”
At the same time, Esho acknowledges that the compliance burden could reshape the competitive landscape. Smaller operators may find it increasingly difficult to meet new capital and regulatory requirements independently, potentially triggering consolidation across the sector.
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“What we may see is smaller institutions coming together to strengthen their capital base and meet the new standards,” he explains. “The regulator wants to ensure that institutions holding customer funds have the financial capacity to withstand shocks and comply with evolving regulations.”
Despite concerns that increased compliance costs could discourage international banking relationships, Esho remains optimistic. In his assessment, transparency and regulatory certainty outweigh the costs associated with stricter oversight.
“Correspondent banks look at both compliance requirements and commercial opportunities,” he says. “Ultimately, transparency and strong governance create a more attractive environment for long-term engagement.”
As the January 2027 deadline approaches, Nigeria’s fintech industry faces a period of adjustment. Yet for Esho, successful implementation will be measured not simply by compliance but by the sector’s ability to emerge stronger, more resilient and more globally competitive.
For a country already recognised as Africa’s digital payments powerhouse, the reforms may well prove to be another important step in its ambition to become the continent’s leading financial technology hub.
