The value of transactions over Point of Sales (PoS) terminals in Nigeria jumped to N735.6 billion in September 2022.
This came as the highest monthly record of transactions on the platform as more Nigerians go cashless.
According to data released by the Nigeria Inter-Bank Settlement System (NIBSS), Nigerians have in the first 9 months of this year spent a total of N6.05 trillion over PoS. With 3 months to go, this is almost the same amount recorded in the full year 2021, which stood at N6.4 trillion.
PoS transaction data
Year on year, the September figure shows a 32% increase when compared with the N5556.4 billion recorded in the same month last year.
Similarly, the volume of transactions on PoS went up as it increased by 14% year on year to 100.4 million in September 2022.
- NIBSS data further reveals that the transactions were carried out over 1.484 million active terminals deployed by merchants across the country.
- This also shows that a total of 568,488 additional PoS terminals have been deployed over the last 9 months as the number of deployed machines stood at 915,519 as of December 2021.
- However, there is still a gap between the number of registered PoS and the number of deployed machines. According to NIBSS, a total of 2.164 million PoS machines had been registered across the country as of September this year, which showed that a total of 680,991 terminals are either yet to be deployed or have become inactive.
The driving forces
The growth of PoS transactions in Nigeria is being driven by many factors, part of which include rapid adoption by merchants for receiving payments.
- PoS is also bridging the gap created by the shortage of Automated Teller Machines (ATMs) deployed by banks, as many Nigerians now withdraw through PoS agents.
- The profitability of POS transactions for both banks and vendors has bolstered the growing deployment of POS. The cost of the transaction is often borne by the customers, creating profit for the POS operator and the bank.
In recent times, it has also served as a means of employment for Nigerian youths, who are building businesses through the offering of POS services.
What you should know
Although the use of PoS machines in Nigeria is growing steadily, a recent report by NIBSS indicated that a majority of this growth is concentrated in the country’s economic capital, Lagos.
According to NIBSS Instant Payment data, the state recorded the largest number of PoS transactions in the country in 2020.
- The report shows that Lagos accounted for about 70% of the total volume of PoS transactions in 2020. This represents a 100% growth in the volume of PoS transactions in the state as the volume of PoS transactions rose from 226 million in 2019 to over 453 million at the end of 2020.
- Abuja came as distant number 2 with a 4.9% contribution after completing over 32 million transactions during the year. Rivers followed closely at number 3 with a contribution of 4.7% after completing 31 million transactions in 2020.
- Other states in the Top 5 PoS locations by volume include Oyo with a contribution of 2.6% (17.2 million) and Delta with a contribution of 2.5% (16.6 million).
At the bottom of the pile, the northern states of Zamfara (210, 069), Yobe (118, 609), and Kebbi (98,000) dominated the list with less than 1% of the total PoS volume.