Data Protection for Fintechs: Lessons from Nigeria and the United States

Fintechs run on data: identity documents, bank statements, transaction histories, device information. That data is what makes fast onboarding and smart credit decisions possible. It is also what regulators, customers and attackers care about most. Companies operating across Nigeria and the United States face two different legal frameworks, and the safest approach is to design for both from the start. This is general guidance, not legal advice.

Nigeria

The Nigeria Data Protection Act 2023 established the Nigeria Data Protection Commission and set rules on lawful processing, consent, data subject rights, security and cross-border transfers. Organisations processing significant volumes of personal data have registration and compliance obligations with the Commission.

United States

There is no single federal privacy law. Financial institutions are covered by the Gramm-Leach-Bliley Act's privacy and safeguards rules, and a growing number of states have their own consumer privacy laws. Breach notification rules vary by state.

Principles that work in both

• Collect less: only the data the product genuinely needs.
• Know where it lives: a data map showing systems, vendors and countries.
• Be clear with customers: plain-language notices and real choices.
• Secure by default: encryption, access controls, logging and tested incident response.
• Manage vendors: contracts and checks for every processor that touches customer data.
• Delete on schedule: retention rules applied in practice, not just in policy.

A data protection programme in eight steps

1. Map what personal data you collect, where it is stored and who can access it.
2. Identify the legal basis for each use, such as consent, contract or legal obligation.
3. Publish a clear privacy notice in plain language.
4. Limit collection to what you need and set retention periods.
5. Secure data with encryption, access controls and monitoring.
6. Review vendors and include data protection terms in contracts.
7. Prepare a breach response plan, including regulator notification timelines.
8. Train staff and appoint a responsible data protection officer where required.

Cross-border data transfers

Fintechs that operate in both Nigeria and the United States often move data between countries for processing, support or analytics. Nigeria's law places conditions on transfers outside the country, and US state laws impose their own obligations. Document every cross-border flow, the safeguards used and the contractual protections in place. When regulators ask, a clear record is the best defence.

Privacy as a product feature

Customers increasingly choose financial providers they trust with their data. Clear consent screens, easy account deletion, transparency about how data is used and fast responses to customer requests are not only compliance tasks. They build loyalty and reduce complaints. In financial services, trust is the product, and data protection is part of it.

A leader's view: privacy by design

Data protection is cheapest and most effective when built into products from the start. Retrofitting privacy controls into an existing product is expensive and often incomplete. Leaders should require that every new product or feature passes a privacy review before launch: what data does it collect, why, where is it stored, who can access it, how long is it kept and how is it deleted?

Leaders also need to manage vendors carefully. Fintechs rely on cloud providers, identity verification services, analytics tools and marketing platforms, each of which may process customer data. Contracts should specify data protection obligations, security standards, breach notification and audit rights. Vendor risk reviews should be repeated periodically, not only at onboarding.

Finally, leaders should prepare for incidents. Even well-protected companies suffer breaches. A tested response plan, clear decision rights and pre-drafted communications allow a company to contain damage, notify regulators and customers within required timelines and maintain trust. In my experience across compliance, forensics and technology, transparency after an incident is often what determines whether customers stay. Companies that communicate clearly and act responsibly recover; those that hide problems rarely do.

Trust is a growth strategy

Customers hand financial data only to companies they trust. A strong privacy posture shortens bank partnership negotiations, reassures investors and reduces the cost of incidents. At Tenaza we registered with the data protection regulator because the information we handle in recovery and tracing work demands that discipline.

Common questions

What is the Nigeria Data Protection Act?

The Nigeria Data Protection Act 2023 is Nigeria's main data protection law. It sets principles for processing personal data, gives individuals rights over their data and established the Nigeria Data Protection Commission.

Does the United States have a national privacy law?

No single comprehensive federal law exists. Financial data is covered by laws such as the Gramm-Leach-Bliley Act, alongside a growing number of state privacy laws.