Transactions through electronic payment (e-payment) channels in the country rose by 8.98 per cent, or N7.86 trillion, to N95.31 trillion in July 2024 from the N87.45 trillion recorded in the previous month, a report by Financial Derivatives Company Limited (FDC) has shown.
The firm, which cites e-payment transactions data obtained from the Nigeria Interbank Settlement System (NIBSS), attributed the increase in the value of e-payment transactions to the surge in Nigeria’s foreign exchange transactions in July.
It said: “The surge in Nigeria’s foreign transactions, reaching N540.48 billion in H1’24, contributed to the increase,” adding that the country’s foreign transactions, “skyrocketed by 272.54 per cent from N145.08 billion compared with H1’23.”
An analysis of the FDC report shows that NIBSS Instant Payment (NIP) transactions rose by 12.46 per cent to N89.50 trillion in July from N79.59 trillion in June.
The report also indicates that the value of transactions through Point of Sale (POS) terminals, headed north last month as it increased by 8.02 per cent to N1.05 trillion compared to N930.76 billion in June.
Similarly, the value of cheque transactions increased in July, rising by 29.81 per cent to N293.76 billion from N226.30 billion in the previous month.
According to the report, transactions through Nigeria Interbank Settlement System Electronic Fund Transfer (NEFT), however, fell by 32.81 per cent to N4.51 trillion in July from N6.71 trillion in June.
Further analysis of the data shows that apart from the decline that it recorded in April, total value of e-payment transactions maintained an upward trend in the first seven months of this year.
Indeed, in an earlier report, FDC had noted that the total value of e-payment transactions “has been increasing steadily since July 2023.”
Analysts note that there has been increased adoption of epayment in the country in recent years, occasioned by factors such as the Central Bank of Nigeria’s (CBN) initiatives to promote the cashless policy, the impact of the 2020 Covid-19 crisis and the naira redesign programme introduced by the apex bank in late 2022.
In its report titled, “Instant Payments – 2020 Annual Statis – tics”, the NIBSS, for instance, stated: “The Covid-19 pandemic changed the e-payments landscape, accelerating the adoption of instant payments as more people transitioned to electronic channels for funds exchange in the wake of government-imposed lockdowns.”
New Telegraph reports that implementation challenges with the CBN’s naira redesign policy led to an acute shortage of cash, thereby crippling economic activities across the country in the first quarter of last year, and forcing bank customers, who were unable to access cash at the time, to adopt e-payment channels.
As a result, data released by the NIBSS indicates that the value of electronic payment transactions surged year-onyear (YoY) by 298 per cent to N135.52 trillion in the first quarter of 2023 from N34.04 trillion in the corresponding period of 2022.
In addition, latest data published by NIBSS shows that total electronic payment transactions hit an all-time high in 2023 as it rose by 55 per cent to N600 trillion, compared with N387 trillion in 2022.
The data further shows that the volume of transactions processed by NIBSS in 2023 jumped by 90 per cent from 5.1 billion in 2022 to 9.7 billion in 2023. In terms of usage of epayment channels, the data indicates that the value of instant payments increased significantly to N71.95 trillion in December 2023 from N42.02 trillion recorded in the same month the previous year.
It also shows that Nigerians used POS terminals 1.38 billion times, amounting to N10.7 trillion transacted in 2023, while transactions by Mobile Money Operators (MMOs) amounted to N46.6 trillion.