The latest data from the Nigeria Inter-Bank Settlement System (NIBSS) showed that the strong growth recorded across the various e-payment channels in 2021 continued into 2022. Specifically, NIBSS Instant Payment (NIP) transactions recorded a solid 46.2% y/y and 53.4% y/y increase in transaction value and volume to N53.8tn and 704.m, respectively, in the first two months of the year.
For POS transactions, total transaction value and volume grew 19.9% y/y and 25.6% y/y, respectively, to N1.1tn and 179.0m in the same review period. The highest growth was recorded in the mobile transactions category where transaction value was more than twice as tall, beating that of 2021 by 168.8% y/y to N2.1tn. Likewise, transaction volume was up by 126.5 y/y to 68.5m in the first two months.
The pandemic which allowed for the blossoming of digital payments has paved the way for the continued growth in e-payments transaction volume and value in Nigeria, reflecting the enduring shift away from cash. This has also been driven by the increasing internet & mobile penetration and investment by banks and other payment-based fintech companies in payment technology infrastructure.
Furthermore, the growth in POS transactions shows the increase in agency banking services. Likewise, the increase in mobile inter scheme transactions, also reflects more coverage in capturing the population. Also, we believe the newly launched e-Naira, though still at the nascent stage, if fully integrated into e-payment channels, will spur growth.
Notwithstanding the growth, the Nigerian e-payments industry is still poised for further growth as alternative payment channels evolve. We have seen the development of Nigeria Quick Response (NQR) code by the NIBSS, even with more players keying into facilitating contactless payments. The country’s favourable demographics and regulatory support continue to inform our expectation of accelerated growth of the Fintech industry in Nigeria.
This expectation has received much attention from investors, which has led to significant investments as existing players look to position for future growth.
CSL Stockbrokers Limited, Lagos (CSLS) is a wholly owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange.