The Nigerian central bank has recently released operational regulations for open banking in the country, which is expected to promote efficiency and access to financial services. The guidelines, which were developed in collaboration with other industry stakeholders, aim to ensure “consistency and security” within the open banking system.
Permissioned Data Sharing
On March 7, the Central Bank of Nigeria (CBN) declared that it had issued operational regulations for open banking in the nation. According to the CBN, the regulations are meant to foster the “sharing of customer-permitted data between banks and third-party firms for the construction of customer-focused products and services.” The regulations are expected to enhance both efficiency and access to financial services.
The CBN issued a circular to financial institutions and payment service providers, in which it noted that it had been aware of the “existence of an ecosystem for Application Programming Interface (API) in the financial and payments system.” It added that it had also been aware of plans to “develop acceptable standards among stakeholders.”
The CBN revealed that some of the regulations’ objectives include ensuring “consistency and security across the open banking system” as well as promoting competition and enhancing access to financial institutions.
Open Banking Repository
To begin with, the CBN said it will provide and maintain an open banking repository (OBR) which will act as the industry’s storehouse.
“The OBR will be a public storehouse for details of registered participants. Each participant will be identified by its CAC [Corporate Affairs Commission] business registration number, which will be the unique key across the OBR system. The OBR will maintain an API interface, defined within these regulations, which will serve as the primary means by which API providers manage the registration of their API consumers,” the CBN stated.
The CBN also said that all involved parties are required to “ensure strict compliance” with the regulations as well as other applicable regulations. For its part, the central bank said it will continue to monitor developments and may “release guidance as may be necessary.”
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