Analysis of Open Banking Policy and its Implications for the Nigerian Financial Services Industry

Open banking, enabled by application programming interface technology and regulatory mandates for data sharing, represents a transformative policy development for the Nigerian financial services industry, with significant implications for competition, innovation, and consumer protection. This study analyses the Central Bank of Nigeria's open banking regulatory framework, released in 2021, and assesses its implications for traditional banks, fintech companies, and banking consumers in Nigeria. A policy analysis and professional assessment methodology was adopted, combining regulatory document review with structured interviews from 45 technology and innovation executives across commercial banks, fintech operators, and regulatory bodies in Lagos. The analysis assessed readiness, competitive implications, data privacy risks, and consumer benefit potential using a structured assessment matrix. Thematic analysis was applied to qualitative data. Results revealed that only 30% of commercial banks had a defined open banking technical implementation road map at the time of the study. Fintech operators expressed high optimism about market access opportunities but raised concerns about data sovereignty and liability allocation in the open banking ecosystem. Consumer awareness of open banking was near zero, with 97% of surveyed customers unfamiliar with the concept. The study concludes that open banking holds transformative potential for the Nigerian financial services industry but requires accelerated technical readiness from banks, strengthened data protection legislation, and consumer education campaigns before full benefits can be realised.

Keywords: open banking, API technology, Central Bank of Nigeria, fintech, financial services industry