Data Privacy Concerns Threaten Nigeria’s Financial Inclusion Goals
Growing fears over data privacy and security are increasingly undermining Nigeria’s push for broader financial inclusion, despite years of investment in digital infrastructure and connectivity.
While policymakers have prioritised broadband expansion, mobile penetration and fintech growth, experts now argue that trust — particularly in how personal data is collected, stored and used — could determine whether millions of Nigerians fully embrace formal financial services.
In 2012, the Central Bank of Nigeria set a target to reduce adult financial exclusion to 20 per cent by 2020 under its National Financial Inclusion Strategy. However, the exclusion rate remained at 36 per cent in 2020, highlighting persistent barriers to adoption.
Industry stakeholders say the challenge has shifted from infrastructure gaps to confidence gaps.
Uchenna Agbo, Chief Commercial Officer at Optasia, noted that while connectivity is important, it does not automatically translate to participation.
“Increasing connectivity is essential, but it is only a prerequisite. True inclusion requires meaningful participation, and that depends on trust,” he said.
Across busy commercial centres such as Balogun Market, many traders who still rely heavily on cash transactions remain cautious about adopting digital platforms. Although mobile phones and awareness of mobile money services are widespread, concerns about fraud, data breaches and unauthorised access to personal information continue to discourage uptake.
Reports of compromised accounts and leaked data have further reinforced fears among small business owners, who view privacy risks not as abstract regulatory concerns but as direct threats to their livelihoods.
The debate has intensified following the enactment of the Nigeria Data Protection Act and the creation of the Nigeria Data Protection Commission, tasked with enforcing standards and promoting responsible data practices.
Analysts, however, caution that regulation alone will not solve the problem. They argue that financial service providers must embed privacy safeguards into product design — an approach known as “privacy-by-design” — rather than treating data protection as a compliance formality.
Agbo stressed that data privacy should be viewed as core infrastructure, as fundamental as the digital networks that power financial services.
Optasia, which operates in 38 countries and serves over 120 million monthly active users, maintains that experience from other markets shows trust directly influences digital adoption, particularly among underserved populations.
Consumer advocates warn that privacy breaches can have severe consequences for low-income users. Misuse of biometric data, unauthorised sharing of financial histories and data-driven predatory lending practices risk eroding public confidence and slowing progress toward financial inclusion.
As Nigeria continues its digital transformation, experts say restoring and maintaining trust may prove just as critical as expanding access.
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