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N500m Fine, 10 Years Jail Awaits Illegal Transfer of Payment Data – Reps Bill
A bill before the House of Representatives has proposed a 10-year jail term and a minimum fine of N500m for unauthorised transfer of payment transaction data outside Nigeria.
The bill, sponsored by Lanre Okunlola, representing Surulere II Federal Constituency of Lagos State, also seeks to compel banks, fintech companies and payment service providers to store their primary payment data infrastructure within Nigeria.
Institutions that violate the localisation requirement risk a minimum fine of N1bn plus daily penalties.
Titled ‘A Bill for an Act to Establish the National Payment Data Protection and Sovereignty Commission’, the legislation seeks to establish the Commission as the principal authority for protecting and regulating payment transaction data generated within the country.
According to the bill, introduced last week, all payment transaction data generated in Nigeria would be classified as a “Strategic National Economic and Security Asset” and must be stored and processed through infrastructure physically located within the country.
Section 23 provides that anyone who transfers payment data outside Nigeria without authorisation commits an offence liable to imprisonment not exceeding 10 years, a fine of not less than N500m, or both.
Section 22 prescribes a minimum N1bn fine for institutions that fail to localise data.
The bill, however, provides a framework for authorised cross-border transfers where necessary for international settlement, with approvals required from both the proposed Commission and the Central Bank of Nigeria.
It also classifies payment transaction infrastructure as Critical National Information Infrastructure and empowers the Commission to set minimum cybersecurity and resilience standards.
SOURCE: The PUNCH
