There is a structural question at the heart of Nigerian finance that is not being debated with the seriousness it deserves. Decisions that affect access to credit, the movement of payments, the detection of fraud and the measurement of risk are now produced inside systems that many Nigerian institutions neither own nor fully understand. These systems shape outcomes for households, businesses and the wider economy, yet the logic behind them is often supplied by companies based outside the country.
This development has taken root not through policy, but through procurement choices that seemed harmless at the time but now carry national implications.
For years, regulators and institutions assumed that the entity responsible for a financial decision also owned or controlled the tools used to make it. That assumption shaped reporting standards, liability frameworks and supervisory expectations. It is no longer the case. Many banks and fintech firms now rely on foreign systems to assess customers, flag transactions or detect anomalies.
When a decision goes wrong, responsibility remains local, but the method that produced it lies outside the reach of those who carry the consequences. This raises a practical and political question: who holds real control over the decision-making core of Nigerian finance?
Nigeria is familiar with dependency in many forms, but the pattern emerging here is different. It is not about oil, trade or imports. It is about the methods that sit beneath financial decisions being shaped elsewhere. When a credit tool designed for foreign markets is applied without local context, the assumptions behind it can misjudge Nigerian customers. When fraud-detection methods built on foreign behavioural patterns are used in local transactions, false alarms and blind spots become common. When several institutions adopt the same foreign tool, their decisions start to align around methods not designed with Nigeria in mind. This alignment may appear efficient on the surface, but structurally it creates uniformity of judgement rooted outside national control.
The adoption of these systems is not driven by external pressure. It happens because licensing a ready-made solution is cheaper and quicker than building one. Institutions under cost constraints or shareholder pressure prefer convenience. Yet the long-term effect is a system where the foundations of decision-making are rented rather than owned. Renting logic might cut costs, but it weakens sovereignty in a domain where independence matters.
A deeper concern lies in concentration. Nigeria already knows the risks of depending on a small number of payment switches: when one fails, the entire country feels it. The same pattern is now forming across wider financial functions. If the majority of institutions use the same foreign scoring tool, the same fraud-detection method or the same risk engine, a single defect or misjudgement can travel through the entire market. Concentration reduces resilience. It also weakens the ability of regulators to intervene. A method that is not designed locally, and cannot be inspected in detail, cannot be supervised effectively.
Regulation becomes a performance rather than a tool of enforcement.
For Nigeria to protect its financial stability and autonomy, institutions must regain control over the systems that produce critical decisions. No bank or payment provider should depend on tools that cannot be examined or challenged. Audit rights must be a condition for adoption, not an afterthought. Responsibility cannot exist without control. If a Nigerian institution is answerable for an outcome, it must have authority over the mechanism that produced it.
The country also needs a broader range of solutions. Relying on a narrow set of providers compresses the entire market into a single point of failure. Diversity of systems is not duplication; it is insurance. Markets with varied tools are harder to destabilise and easier to supervise.
Most importantly, Nigeria must invest in local capability. A country that does not build the methods behind its financial decisions will remain dependent on others for judgement that should be sovereign. Capability in this area is not a luxury. It is national infrastructure, as essential as power, security or transport. Without it, Nigeria will continue to carry the risk for decisions shaped by tools it does not own.
The central question is simple: can Nigerian rules remain effective when the core mechanisms behind financial decisions lie outside Nigerian control? Until that question is addressed, the foundations of the financial system will rest on ground that does not belong to the country.
Michael Irene, CIPM, CIPP(E) certification, is a data and information governance practitioner based in London, United Kingdom. He is also a Fellow of Higher Education Academy, UK, and can be reached via moshoke@yahoo.com; twitter: @moshoke
