On September 8, 2026, the Central Bank of Nigeria (CBN) issued a press statement elevating terrorism financing supervision to a current supervisory priority.
While the significance of this announcement is clear to regulatory and compliance professionals, in my view, financial institutions should read it as a subtle but important warning.
The message is not necessarily about introducing an entirely new regulatory framework. It is about placing greater supervisory attention on obligations that already exist. Financial institutions should therefore expect closer examination of how their existing controls operate in practice, particularly around terrorism financing risk management, transaction monitoring, sanctions screening and suspicious transaction reporting.
The question then becomes: what will the regulator look for during an examination?
For me, this starts from the point of onboarding. Accurate data capture is fundamental to effective financial crime compliance. If customer information is incomplete, inaccurate or poorly structured at onboarding, every subsequent control is affected. Risk scoring becomes less reliable. Screening becomes less effective.
Transaction monitoring loses context. Reporting becomes more difficult.
Financial institutions therefore need to look closely at their onboarding processes, customer due diligence, beneficial ownership information, source of funds, source of wealth where applicable, customer risk classification and the quality of information being captured and maintained.
Screening also needs to move beyond a one-time onboarding exercise. Customers, beneficial owners and relevant counterparties need appropriate ongoing screening against sanctions and other relevant risk indicators, with effective processes for reviewing and resolving potential matches.
The same applies to transaction monitoring. Institutions need to examine whether they are conducting real-time or sufficiently timely monitoring of transactions, rather than relying primarily on retrospective reviews. The ability to identify unusual transaction behaviour, changes in customer activity, high-risk transactions, unusual counterparties and potentially connected transactions is becoming increasingly important.
Reporting is another area requiring attention. Institutions need to assess whether alerts are being properly investigated, escalated and reported where required. Equally important is whether there is a clear audit trail showing how decisions were reached, who reviewed them and what action followed.
This is where I believe RegTech needs to move from being viewed as a technology investment to being recognised as part of the compliance infrastructure.
A properly integrated RegTech environment should support the institution from onboarding through monitoring, screening, investigation and reporting. It should help validate customer data, automate appropriate screening, continuously assess risk, monitor transactions, identify patterns, manage alerts, support investigations and maintain a reliable audit trail.
The objective is not to replace the compliance professional with technology. It is to give compliance teams the data, intelligence and operational visibility required to make better decisions and respond faster.
There is also a wider strategic consideration.
For financial institutions looking beyond Nigeria, strong technology-enabled compliance becomes increasingly important when entering international markets.
Different jurisdictions bring different regulatory expectations, sanctions regimes, reporting obligations, customer identification requirements and supervisory standards. A fragmented, manual compliance environment becomes difficult to scale across multiple markets.
A well-designed RegTech framework provides a stronger foundation for expansion because the institution’s compliance architecture is built around structured data, consistent controls, automated monitoring and demonstrable evidence. It supports the institution in adapting its control environment as it enters new jurisdictions and interacts with new customers, currencies, payment channels and counterparties.
This is why I see the CBN’s latest position as more than a regulatory compliance issue. It is an opportunity for financial institutions to rethink how their compliance infrastructure is designed.
The institutions that will remain resilient are those that know their customers, understand their counterparties, capture accurate data, monitor activity effectively, report appropriately and maintain evidence of their decisions.
The question every financial institution should now be asking is simple:
If the regulator examined our framework tomorrow, would we be able to demonstrate that our controls exist, or that they actually work?
For me, the answer increasingly points towards one direction: technology-enabled compliance is no longer optional infrastructure for a modern financial institution. It is becoming an essential part of staying compliant, audit-ready and ready for international growth.
Kanayo Kemuwa
Reg Tech Founder | Compliance & Technology Infrastructure | Digital Banking Systems
