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Nigeria’s Central Bank (CBN) has approved the launch of open banking, mandating that banks begin sharing customer data with other financial institutions starting in August 2025, according to one person with direct knowledge of the meeting. Nigeria becomes the first African country to implement open banking, four years after the Central Bank of Nigeria first released its regulatory framework for the initiative.
With the CBN’s approval, customers can now consent to allow regulated financial institutions to access their data, such as account balances, transaction histories, and spending patterns, and, in some cases, even initiate transactions on their behalf.
The data will be shared through a standardised API that all banks and participating institutions can connect to, enabling secure and consistent access. A central registry will identify and authenticate all participants, while a consent management framework tied to customers’ Bank Verification Numbers (BVNs) will ensure that customers remain in full control of who can access their data and for what purpose.
The CBN revised its approach after pushback from the banking industry against centralising control under the Nigerian Interbank Settlement System (NIBSS). It has now established independent committees to oversee open banking, led by bankers and employees of financial institutions without direct CBN control over any of the committees.
The importance of open banking cannot be overstated. By accessing years of data on Nigeria’s 120 million bank customers, financial institutions can use this data to offer new services to Nigerians.
The most likely service to improve with access to data is lending. So far, bank-led lending has resulted in low credit penetration, with as much as 70% of bank account holders locked out from accessible credit. FIntechs have entered the credit market to fix this despite having limited data, leading to a mixed bag of subprime loans and predatory collection methods.
With open banking, lending fintechs would receive data (transaction history, consumption patterns) from banks to assess creditworthiness and also help create a much-needed credit score for Nigerians. Financial institutions can also create new types of personalised financial products backed by data.
*This is a developing story.
