The Central Bank of Nigeria’s directive requiring banks and fintechs to host their data in Nigeria by January 2027 is creating fresh demand for local data centre and cloud infrastructure, while raising questions about capacity, resilience and power.
For Ayotunde Coker, CEO of Open Access Data Centres (OADC), the policy could do more than bring financial institutions’ data back home.
He believes Nigeria has the infrastructure, connectivity and gas resources to scale its data centre capacity significantly and position the country as a hub capable of exporting computing services.
In this interview with Nairametrics, Coker discusses the impact of the CBN directive on demand for data hosting, the readiness of local data centres to handle banks’ workloads, power and redundancy challenges, the growing concentration of data centres in Lagos, and why banks need to move quickly as the 2027 deadline approaches.
Ayotunde Coker: One impact on the economy will be much greater efficiency from leveraging the platforms we have here. That growth is going to be significant because of the support chain that we have.
There will be increased employment and growth in data centre capacity. We will be building more capacity as demand increases, and that represents significant investment in terms of build out.
I would not be able to say that this will result in, for example, a 1% increase in GDP or GDP growth from one point to another, because it is quite difficult to pinpoint. But there are specific opportunities for growth and expanding capacity.
It is not just data centre companies. Local cloud companies will also have to expand their capacity and bring in more functionality. They will need more resources to provide these capabilities, along with the support that comes with them.
So, there is an economic impact in terms of direct employment and indirect and induced activity. It could leverage our colocation capacity. As we grow, we build out more and leverage a lot of local resources.
In terms of what we have sensed at OADC, we have seen increased discussions in our pipeline for more growth, particularly with fintech platforms and other core banking platforms.
There are two sides to it. Cloud companies are looking at growing their capabilities, but that is somewhat of a lagging response because they will grow based on the demand and contacts they have from fintech companies. A lot of those companies are fintechs themselves.
We have multiple discussions ongoing. I cannot be more specific, but I can be clear that we have seen a step change in the interest in taking more colocation capacity or using more cloud services.
We have also seen growth in demand for cloud services, with our partners looking at taking on more functionality to support that demand.
Ayotunde Coker: I am really quite surprised that you would get an assertion like that. Wouldn’t you feel rather that your data is safe in the country where you operate?
The data centres in the country comply with the strongest and most stringent international standards for physical security, as well as the relevant construction certifications.
We have certifications for ISO 27001 and uptime certification. We also have PCI DSS certification for financial institutions. It is a world class environment.
You might as well assert that the same thing would happen elsewhere. It is a very weak argument, in my view. Data centre standards are global standards. They are not just backroom server rooms. In fact, organisations should put in place the systems that protect their own data.
Whether you are hosted in Lagos or hosted in Frankfurt, you have to ensure that you have the right data and application architectures that protect your data.
Performance also improves significantly because you are actually hosted closer to your user base.
Ayotunde Coker: We have a track record of 100% uptime. We have an interconnect ecosystem with more than 45 carriers and growing. We have multiple connectivity options to all the subsea cable systems. WIOCC has a point of presence in all the key data centres.
We directly have capacity that connects into many subsea cable systems. What more resilience would anybody want by world class standards?
We carry both local and international capacity. In fact, it is even more resilient than some of the international data centres where people are hosted. I am proud to be able to say that, and it is in Nigeria.
Ayotunde Coker: Right now, we have available capacity. We have the capability and framework of the data centre to support hyperscaler requirements. As I have said, it is world class.
We have significant capacity available that we are fitting out. It is elastic capacity that we are progressively fitting out to create more available capacity, driving towards 2 megawatts of power right now.
One of the key things is that we are building at our location in Lekki is in stages, with standard cloud capacity of 6 megawatts each, taking it to 24 megawatts in four stages.
However, it is also engineered for AI. Our estimate is that the capacity required for AI will probably be around 40 megawatts rather than 24 megawatts.
The next question is where the power will come from. We have invested in very direct connectivity to the utility provider in Lekki.
As we build up power, we also have plans to link into the gas pipelines. There are pipelines running in different directions that will provide resilience as we build out our capacity. We also have plans for on site capacity driven by gas of up to 50 megawatts.
This is part of our expansion plans. We will continue to build out capacity to meet local and international cloud requirements, as well as colocation requirements. The aim is to build what will become the largest data centre campus in West Africa.
Ayotunde Coker: It is not unusual to have data centre clusters. One example that is talked about quite a lot is Ashburn in Virginia, which is a data centre cluster. Lekki and Victoria Island are becoming a data centre cluster as well.
Clusters help drive the growth of gas delivery and ensure that power providers can provide the required power. You also have facilities on the mainland, such as Rack Centre and NTT, while Eko Atlantic is also developing additional data centre capacity.
Although you have the Lekki axis becoming something of an Ashburn type cluster, there is also some distribution across Victoria Island, Eko Atlantic and the mainland. It is not unusual for other clusters to emerge.
If you look at the UK, for example, you have Slough as a data centre cluster, alongside other parts of East London.
We are also seriously looking at having other locations, including Port Harcourt and Abuja. Some data centre providers have already moved into these locations. For instance, Galaxy Backbone has a data centre there.
You will see some distribution because it gives us a more efficient architecture. With WIOCC, we have national long-distance networks and high availability going to locations such as Port Harcourt, Abuja and Ibadan.
