Growing concerns over data privacy and security are emerging as a significant barrier to Nigeria’s financial inclusion drive, despite years of investment in connectivity and digital infrastructure.

While policymakers and industry stakeholders have long focused on expanding broadband access, mobile penetration, and fintech innovation, experts now argue that trust — particularly around how personal data is collected, stored, and used — may determine whether millions of Nigerians join the formal financial system.

In 2012, the Central Bank of Nigeria set a target to reduce the country’s adult financial exclusion rate to 20 per cent by 2020 under its National Financial Inclusion Strategy. However, the exclusion rate stood at 36 per cent in 2020, according to the regulator’s 2022 report, underscoring persistent gaps in access and adoption.

Industry leaders say the challenge is no longer primarily about infrastructure.

“Increasing connectivity is essential, but it is only a prerequisite,” the Chief Commercial Officer at Optasia, Uchenna Agbo, said. “True inclusion requires meaningful participation, and that depends on trust.”

Across major commercial hubs such as Balogun Market, traders who rely heavily on cash transactions often remain hesitant to adopt digital financial services. Although many own mobile phones and are aware of mobile money platforms, concerns about fraud, account hacking, and misuse of personal information continue to discourage uptake.

Stories of compromised accounts and data leaks have circulated widely, reinforcing fears among small business owners that using digital systems could expose sensitive personal and financial information.

For many low-income earners, privacy risks are seen not as abstract regulatory issues but as threats to livelihoods.

The issue has gained renewed prominence following the enactment of the Nigeria Data Protection Act and the establishment of the Nigeria Data Protection Commission, which is tasked with enforcing data protection standards and promoting responsible data practices across sectors.

Analysts say regulatory frameworks are necessary but insufficient on their own. They argue that financial service providers must move beyond compliance and embed privacy protections into the design of products and services, a model often referred to as “privacy-by-design”.

“Data privacy should not be treated as a compliance obligation or a technical feature added at the end of development,” Agbo said. “It must be seen as core infrastructure, as fundamental as the networks and platforms that deliver the services.”

Optasia, which operates in 38 countries and serves more than 120 million monthly active users globally, says lessons from other markets show that trust directly influences digital adoption rates, particularly among underbanked populations.

Consumer advocates note that for low-income users, the consequences of privacy breaches can be severe. Misuse of biometric data, unauthorised sharing of financial histories, or predatory lending practices enabled by data analytics can undermine confidence and deter participation in formal systems.

Gombe State Governor, Muhammadu Yahaya, on Tuesday, hosted his Yobe State counterpart, Mai Mala Buni, and the Senior Special Assistant to the President on Political and Other Matters, Ibrahim Masari, for the inauguration of major projects and the groundbreaking of new Local Council Development Areas secretariats.

Among the projects inaugurated were the new Nafada Local Government Secretariat, the Nafada four-span bridge, and a mega non-formal learning centre (Tsangaya School), all described as strategic interventions aimed at boosting governance and socio-economic development in Nafada and adjoining communities.

The new secretariat replaces a dilapidated structure that had long hindered effective service delivery, while the four-span bridge resolves years of seasonal inaccessibility that cut off communities during the rainy season.

The Tsangaya School is designed to integrate Almajiri children into a structured and supportive learning system.

Masari, on his part, inaugurated the 7.5-kilometre Kwanan Rugaji–Almakashi Road, with a spur to Gargaldu, linking Funakaye Local Government Area of Gombe State to neighbouring communities in Yobe State. The road is expected to ease transportation challenges and stimulate economic activities in the area.

He also inaugurated a 66-shop ultra-modern commercial complex in Bajoga, named after the late Emir Muhammadu Kwairanga, to enhance commerce and provide a conducive business environment for traders.

At the foundation-laying ceremonies for the Funakaye South LCDA in Tongo and the Nafada South LCDA in Birin Fulani, Yahaya said the creation of 13 LCDAs was a deliberate move to deepen grassroots governance.

“Today marks another significant milestone in our journey to deepen democracy and accelerate development at the grassroots.

“The foundation laying for Funakaye South LCDA and Nafada South LCDA is a direct outcome of our administration’s decision to create 13 Local Council Development Areas.

“These LCDAs are designed to institutionalise meaningful development and bring governance closer to our people. Our vision is clear: in due course, they will metamorphose into full-fledged local government areas as we strengthen their structures and capacities,” the governor stated.

He disclosed that subsequent local council elections would be conducted simultaneously with the LCDAs to enhance their democratic legitimacy.

Yahaya said the state drew inspiration from the success of development areas in Lagos State, commending President Bola Tinubu for pioneering the model during his tenure as governor.

“That visionary step has continued to yield dividends, and we are confident Gombe State will record even greater success with this initiative,” he stated.

In his remarks, Buni commended Yahaya for what he described as bold and strategic initiatives to strengthen local governance.

He urged residents to continue supporting the administration and called for sustained prayers for peace and development across Gombe, Northern Nigeria and the country at large.

Speaking during the road inauguration, Masari applauded the state government for aligning its development blueprint with the Federal Government’s Renewed Hope Agenda, describing the projects as evidence of prudent resource management and responsible leadership.

Earlier, the Director-General of the Gombe State Joint Project Development Agency, Mahmood Yusuf, gave an overview of the projects being jointly executed by the state and local governments, assuring quality delivery and timely completion.

During the visit, the governor and his guests paid homage to the Emir of Funakaye and the Emir of Nafada, both of whom commended the administration’s developmental strides and pledged continued support.

At the Funakaye Emirate, Buni was conferred with the traditional title of “Dikuman Funakaye,” while Masari received the title “Dan Saran Funakaye.”

Similarly, the Emir of Nafada honoured Buni and Masari with the titles of “Muqaddas” and “Dan Sarari of Nafada,” respectively.