Electronic payments in Nigeria reached 204.5 trillion naira between January and July 2022
As many businesses in Nigeria continue to adopt the electronic payment system, where customers can pay for goods and services without using cash, this has resulted in a 40% increase in electronic payments in the country, per compared to N145. 8 trillion recorded during the same period last year.
Just recently, the Nigeria Inter-Bank Settlement System (NIBSS) disclosed that transactions worth N204.5 trillion were conducted electronically in Nigeria between January and July this year, through the platform instant payment card (PIN) from the NIBSS.
Last year, Nigeria was among the African countries that recorded high online payment methods. 35% of e-commerce payments were made by card and 21% by bank transfer. The NIBSS revealed that the electronic payment value recorded reflected the increase in transaction volume during the period.
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PIN volume rose to 2.7 billion in seven months, showing a 42% increase from the 1.9 billion recorded in the same period last year. Over the years, Nigerian banks have exposed NIP to their customers through their various channels, such as Mobile Apps, Bank Branches, Internet Banking, Supplementary Service Data (USSD), Point of Sale and ATMs.
NIBSS Instant Payments (PIN) has become the Nigerian financial industry’s preferred remittance platform that guarantees instant value to the recipient. Recall that the Central Bank of Nigeria, CBN, in December 2011 introduced the cashless policy, which was launched in Lagos in January 2012 to reduce the amount of physical cash in circulation.
Its adoption of the cashless economy aimed to increase the operational efficiency of monetary policy, provide alternatives that facilitate transaction-less transactions and have greater reach, improve financial inclusion, and more. This policy has undoubtedly encouraged the use of electronic platforms for the settlement or payment of goods. And services.
It is undeniable that the high rate of electronic transactions in Nigeria reveals that a large percentage of Nigerians are adopting the cashless policy of the Central Bank of Nigeria.
The COVID-19 pandemic has enabled the rise of digital payments, which has paved the way for continued growth in the volume and value of electronic payments transactions in Nigeria, reflecting the sustained move away from cash.
According to the International Monetary Fund (IMF), the value of mobile money transactions in Nigeria increased to 9.72% of gross domestic product in 2020 due to the Covid-19 pandemic. The IMF also revealed that the pandemic has pushed many people to explore internet banking and other digital transactions as it has also led to the growth of agency banking services like POS service.
Of the 986,252 outlets registered in the country, an all-time high of 955,234 were deployed in January 2022, or 100.89% of the 475,494 registered in January 2021.
The Nigerian electronic payments industry is poised for continued growth as alternative payment channels continue to evolve. Furthermore, its favorable demographics and regulatory support have continued to inform expectations for accelerated growth of the Fintech industry in Nigeria.
The boom in electronic transactions also caused the loss of check transactions, which continued to maintain its downward trend. On the other hand, besides the fact that there is an increase in electronic payment in Nigeria, Africa’s rapidly expanding population has made Africa’s digital payment system one of the fastest in the world.