Sustained Growth of e-Payment Transactions; Increased by 40% YoY to N32.8trn in September 2022

Data from the Nigeria Inter-Bank Settlement System (NIBBS) shows that the total value of electronic transactions recorded under the NIBSS Instant Payments (NIP) platform increased by c.40% y/y to c.NGN32.8trn in Sep ‘22. On a year-to-date (ytd) basis, the total value of transactions processed through the NIP platform increased by 42% y/y to NGN271.6trn. The NIP platform has become one of the most widely used methods of payment, due to the steady rise in mobile telephony and internet penetration across the country. The rise of mobile payments has also aided the rapid expansion of Nigeria's e-commerce industry, which has been variously estimated at between USD6bn and USD13bn.

Payments made through the NIP channel often make up over 90% of all electronic payment transactions because of the near-instantaneous nature of transactions and ease of usage.

Although the data is dated, NIP payments recorded a success rate of c.98.2% as at Mar ’20.

With respect to other payment channels, transactions processed through the mobile (inter-scheme) channel increased by 123% y/y to NGN1.7trn in Sep ’22, bringing its total value ytd to NGN12.8trn, or a growth of 153% y/y.

Payments made through the Point-of-sale (PoS) channel increased by 32% y/y to NGN736bn in Sep ‘22. On a cumulative (ytd) basis, the value of transactions processed through PoS channels grew c. 31% y/y to NGN6.1trn.

The E-bills pay channel, primarily used for recurring bill payments grew 17% y/y NGN230bn in Sep ’22. Cumulatively, the total value of transactions between Jan ‘22 and Sep ’22 increased by 31% y/y to NGN2.0trn.

Cheques as a form of payment are becoming less popular. The total value of payments made via cheques for the 9-month period to Sep ’22 was flat y/y at NGN2.4trn.

Looking ahead, we continue to see the rapid proliferation of electronic payment channels.

The CBN’s move to redesign the naira and reduce the value of currency in circulation, and other key measures aimed at promoting a cashless society, will accelerate the growth of e-based payment channels in the near-to-medium term.