According to data from the Nigeria Inter-Bank Settlement System (NIBSS), the total value of transactions recorded under its NIBSS Instant Payments (NIP) platform declined by -5% m/m to c.NGN36.8trn in Feb ’23. On a year-year basis, the value of transactions processed through the NIP platform increased by 35% y/y. The robust y/y growth was supported by a significant 122% y/y increase in the number of transactions performed electronically to 789 million. The mobile USSD channel allows all Nigerian banks access to the NIP payment platform.
The m/m drop in the value of NIP processed transactions can be attributed to the increased number of failed transactions made through the platform.
The data also shows the value of transactions for other payment channels, including point-of-sale (PoS), Mobile (inter-scheme) transactions, and the more conventional payment methods such as cheques.
Mobile (inter-scheme) transactions increased at a faster rate of 134% y/y to NGN2.6trn. This compares with growth of 125% y/y the previous month.
Similarly, the point-of-sale (PoS) channel also recorded a growth of 54% y/y at NGN884bn in Feb ’23.
On the flip side, the E-bills pay channel (which is widely used for bill payments) and cheque payments saw declines of -58% y/y and -8% y/y to NGN91bn and NGN239bn respectively.
Despite the decline in the value of electronic transactions in Feb ’23, the growth of electronic payments in Nigeria has been encouraging and may be traced to the Central Bank of Nigeria’s (CBN) drive to promote a cashless economy.
Another major contributing factor to the fast adoption of electronic payments in Nigeria, is the steady rise in mobile telephony and growing internet penetration across the country.
We believe the CBN’s move to extend its Central Bank Digital Currency (CBCD) to mobile phone users through the launch of the eNaira USSD channel, will further improve financial inclusion in the country.
