By Ifeoma Ben, LLM, MBA
Nigeria’s journey towards a cashless economy is deeply intertwined with the reliability of its telecommunications infrastructure. From mobile banking apps and POS terminals to USSD codes and digital wallets, nearly every non-cash transaction depends on telecom networks functioning seamlessly. As digital payments become central to daily commerce, telecom infrastructure has quietly evolved into critical financial infrastructure—making network security, resilience, and uptime a national economic priority.
Telecom Networks as the Backbone of Digital Payments
Digital payment systems in Nigeria rely on telecom networks at multiple layers. USSD banking transactions depend on real-time signalling between mobile devices, banks, and payment switches. POS terminals require stable mobile or broadband connectivity to authorise transactions. Mobile money platforms and fintech apps rely on constant data availability to process payments, detect fraud, and maintain customer trust. When telecom networks fail, financial services grind to a halt, affecting individuals, small businesses, and the broader economy.
Outages and Their Economic Impact
Network outages, often caused by fibre cuts, power failures, vandalism, or equipment theft, have immediate and visible consequences. Merchants are unable to process payments, commuters struggle to pay for transport, and essential services experience delays. In a country where millions rely on digital payments for everyday transactions, even brief disruptions can undermine confidence in cashless systems and push users back towards cash. These disruptions also pose reputational risks for banks, fintech companies, and telecom operators alike.
Risks to Financial Inclusion and Consumer Trust
Nigeria’s cashless drive is closely linked to financial inclusion, particularly for underserved populations who rely on mobile phones rather than traditional banking infrastructure. Frequent network instability disproportionately affects these users, limiting access to basic financial services. Trust is fragile in digital finance, and repeated transaction failures can discourage adoption, slow innovation, and widen existing economic gaps.
Infrastructure Security and Redundancy
Securing telecom infrastructure requires more than technological upgrades. Redundancy planning such as multiple fibre routes, backup power systems, and network failover mechanisms, is essential to ensure continuity. Infrastructure sharing among operators can reduce vulnerabilities, while improved coordination with state governments can help address right-of-way disputes and physical infrastructure protection. Treating telecom networks as critical national infrastructure is no longer optional in a cashless economy.
Regulatory and Policy Considerations
Regulators such as the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) play a vital role in aligning telecom resilience with financial system stability. Clear service-level expectations, infrastructure protection policies, and coordination frameworks between telecoms and financial regulators are increasingly necessary. Policies that incentivise infrastructure investment and penalise sabotage can strengthen the ecosystem and reduce systemic risk.
The Role of the Legal Industry
Lawyers have a growing role in securing Nigeria’s digital payment infrastructure. Legal practitioners advise telecom operators and financial institutions on infrastructure-sharing agreements, regulatory compliance, and risk allocation in service-level contracts. They also support dispute resolution arising from transaction failures and outages, and advise policymakers on legal frameworks that recognise telecom infrastructure as essential to economic stability. As Nigeria deepens its cashless agenda, legal expertise will be critical in balancing innovation, accountability, and consumer protection.
Looking Ahead
A cashless Nigeria cannot function without secure and resilient telecom networks. Strengthening infrastructure protection, improving redundancy, and aligning regulatory oversight across telecoms and financial services are essential to sustaining trust in digital payments. As technology reshapes commerce, Nigeria’s ability to secure its telecom backbone will determine whether the cashless economy remains resilient or vulnerable to disruption.
