Nigeria is set to see a 32% decline in cash payments by 2030 as it shifts to digital transactions. Key factors include increased smartphone access for financial services and growth in the banked population. Electronic transactions reached N1.07 quadrillion in 2024, reflecting both volume and value increases due to ongoing cashless policies and market changes.
Nigeria is experiencing a notable transition toward digital payment systems, with cash payments expected to decline by 32% by 2030, as indicated by Worldpay’s Global Payment Report 2024. This shift is primarily driven by improved access to financial services in remote areas via smartphones, enabling millions to participate in the global economy.
Currently, Nigeria ranks highest in the Middle East and Africa for cash usage in point-of-sale (PoS) transactions, contributing 40% of PoS value in 2024, a drop from 91% in 2019. In contrast, other countries such as Saudi Arabia (22%), South Africa (30%), and the UAE (17%) exhibit lower cash reliance.
Financial inclusion in Nigeria has progressed significantly, with the World Bank reporting an increase in the banked population from 30% in 2011 to 45% in 2021. The Nigerian Inter-Bank Settlement System (NIBSS) documented that active bank accounts reached 311 million in 2024, highlighting rapid financial changes in the country.
The report indicates that account-to-account (A2A) transfers through NIBSS Instant Payments (NIP) have become the leading e-commerce payment method, with A2A payments via NQR also gaining popularity at PoS, now the second most utilized method after cash.
In 2024, electronic payment transactions soared to N1.07 quadrillion, representing a 79.6% increase from N600 trillion in 2023. The volume of e-payments also expanded significantly, with total transactions processed by NIBSS rising from 9.7 billion in 2023 to 11.2 billion in 2024, achieving a 15.5% year-on-year growth.
PoS transactions reached N19.4 trillion in 2024, marking an 81% increase from N10.73 trillion in the previous year. Experts attribute this surge to a combination of cash shortages in early 2023 and the continued enforcement of the Central Bank of Nigeria’s cashless policy.
The Global Payment Report further reveals progress in digital payments across the Middle East and Africa, with e-commerce transactions increasing from 29% of total value in 2014 to 49% in 2024. Digital payments are projected to constitute 65% of transaction value by 2030. The growth of digital payments at PoS is remarkable; they moved from 1% of transaction value in 2014 to one-third by 2024, with expectations to reach 47% by 2030.
The transition from cash to digital payments in Nigeria is accelerating, driven by enhanced access to financial services through technology. While cash payments remain significant, projections indicate a substantial decline by 2030. The rise in electronic transactions has been bolstered by favorable policies and changing consumer habits, marking a pivotal point in the country’s financial landscape.
Original Source: tribuneonlineng.com
