According to Worldpay’s Global Payment Report 2024, cash payments in Nigeria are expected to decrease by 32% by 2030, fueled by improved access to digital payment options. The report notes Nigeria’s previous cash dominance in transactions and highlights significant improvements in financial inclusion. Moreover, A2A transfers and electronic payments have surged, reflecting the successful implementation of cashless policies in Nigeria.
Nigeria is experiencing a noteworthy transition towards digital payment systems, anticipated to see cash payments decrease by 32 percent by the year 2030. This projection is outlined in the Worldpay’s Global Payment Report 2024, which indicates that advancements in smartphone accessibility have greatly enhanced financial services for individuals in remote areas, thus integrating more citizens into the global economic framework.
The report identifies Nigeria as a leader in cash transactions within the Middle Eastern and African regions, with cash accounting for 40 percent of point-of-sale (PoS) transaction values in 2024, down from 91 percent in 2019. Comparatively, other notable nations such as Saudi Arabia, South Africa, and the UAE show considerably lower cash dominance at 22 percent, 30 percent, and 17 percent, respectively, for the same year.
Progress in financial inclusion has been substantial over the last decade, with the World Bank reporting an upward change in Nigeria’s banked population from 30 percent in 2011 to 45 percent by 2021. Conversely, South Africa experienced an increase from 54 percent to 85 percent within the same period, illustrating a broader trend of financial accessibility improvements.
The Nigerian Inter-Bank Settlement System (NIBSS) revealed that the number of active bank accounts reached 311 million in 2024, exemplifying the country’s rapid financial modernization. Furthermore, account-to-account (A2A) transactions via NIBSS Instant Payments (NIP) have become the leading e-commerce payment method, indicating a growing preference for instant payment options.
Recent statistics indicate that electronic payment transactions reached a monumental N1.07 quadrillion in 2024, reflecting a staggering 79.6 percent growth from N600 trillion in 2023. The number of e-payment transactions also increased substantially, rising from 9.7 billion in 2023 to 11.2 billion in 2024, marking a 15.5 percent year-on-year increase, while PoS transactions surged 81 percent to N19.4 trillion.
Experts attribute this increase in electronic transactions to several factors, including the cash scarcity experienced in early 2023 and the ongoing implementation of the Central Bank of Nigeria’s cashless policy. The Global Payment Report also highlights the overall progression of digital payments in the MEA region, noting an increase in e-commerce transactions from 29 percent in 2014 to 49 percent by 2024, with digital payments projected to account for 65 percent by 2030.
Moreover, there is a distinct shift in the PoS sector, where digital payments made up only 1 percent of transaction values in 2014, escalating to one-third by 2024. Worldpay forecasts that by 2030, digital payments will comprise 47 percent of PoS transaction values, nearing parity with traditional methods.
In conclusion, Nigeria’s financial landscape is undergoing a significant digital transformation, as evidenced by the anticipated decline in cash payments and the remarkable growth in electronic payment systems. The rise in digital transactions emphasizes the importance of financial inclusion and the impacts of technology on traditional banking. As the country advances towards a more cashless economy, the future of payment methods appears poised for further innovation and development.
Original Source: tribuneonlineng.com
