The European Union has formally removed Nigeria from its list of high-risk jurisdictions for money laundering and terrorism financing, a move expected to ease cross-border transactions, lower compliance costs, and improve investor confidence in Africa’s largest economy.
The update, published by the European Commission, follows Nigeria’s removal from the Financial Action Task Force greylist in 2025 after a series of reforms to strengthen its anti-money laundering and counter-terrorism financing framework. Under the new decision, enhanced due diligence requirements on transactions involving Nigeria will be lifted from January 29, 2026, subject to final procedural approval by the European Parliament and the Council of the European Union.
The European Commission said the revision reflects decisions taken by the FATF at its June and October 2025 plenaries, during which several countries were removed from the list of jurisdictions under increased monitoring. As part of the update, the EU added Bolivia and the British Virgin Islands to its high-risk list, while delisting Nigeria alongside Burkina Faso, Mali, Mozambique, South Africa and Tanzania.
Entities operating under the EU’s anti-money laundering framework are required to apply heightened vigilance when dealing with countries on the high-risk list. Nigeria’s removal means that this additional scrutiny will no longer apply to Nigerian-linked transactions within the bloc once the regulation comes into effect, potentially speeding up payments and reducing compliance friction.
Nigerian government officials have described the decision as a major milestone for the country’s economy, particularly at a time when authorities are pushing to attract foreign capital and rebuild confidence in the business environment. The move has been framed as a clear signal to international investors that Nigeria is serious about financial transparency, regulatory reform, and long-term stability.
For businesses, especially banks, exporters, fintech companies, and small and medium-sized enterprises with European partners, the implications are significant. Countries labelled high-risk typically face higher transaction costs, delayed settlements, strained correspondent banking relationships,s and reduced access to foreign investment. With enhanced due diligence requirements lifted, Nigerian firms are expected to experience smoother trade flows, easier access to remittances, and improved engagement with European financial institutions.
The decision also strengthens Nigeria’s credibility as it works to curb illicit financial flows and deepen its integration into global financial markets. For MSMEs, which often bear the brunt of excessive compliance costs, the change could translate into faster payments, lower documentation burdens, and improved opportunities to scale cross-border operations.
Nigeria was removed from the FATF greylist in October last year after implementing reforms aimed at tightening oversight, improving enforcement, and strengthening institutional coordination on financial crimes. The country had been added to the FATF greylist in February 2023, alongside South Africa, while Mozambique and Burkina Faso were listed earlier after similar concerns.
With the EU decision now in place, Nigeria’s exit from both the FATF greylist and the EU high-risk list marks a turning point in its efforts to restore trust in its financial system and position itself as a more attractive destination for trade and investment.
