Nigeria is projected to see a 32% decline in cash payments by 2030 as digital payment methods gain popularity, according to Worldpay’s Global Payment Report 2024. The increase in access to financial services through smartphones has transformed the economy, with significant growth in electronic transactions and a larger banked population. Digital payments are expected to dominate e-commerce and PoS transactions over the coming years, illustrating the country’s shift towards a cashless society.
Nigeria is experiencing a significant transformation in its payment landscape, as represented in the Worldpay’s Global Payment Report 2024. The report forecasts that cash payments will decrease by 32% by 2030, attributed to increased digital payment methods facilitated by greater access to financial services through smartphones.
The report states that Nigeria currently leads the Middle East and Africa in cash transactions at point-of-sale (PoS), which comprise 40% of PoS value in 2024—a decrease from 91% in 2019. Comparatively, the usage of cash in Nigeria is notably higher than in its regional counterparts, such as Saudi Arabia (22%), South Africa (30%), and the UAE (17%).
Improvements in financial inclusion are evident; the World Bank indicated an increase in the proportion of banked Nigerians from 30% in 2011 to 45% in 2021. The Nigerian Inter-Bank Settlement System (NIBSS) further confirmed that the number of active bank accounts rose to 311 million by 2024, highlighting the country’s rapid financial evolution.
The report also noted that account-to-account (A2A) transfers via the NIBSS Instant Payments (NIP) system have emerged as Nigeria’s leading e-commerce payment method. A2A payments via Quick Response codes (NQR) have become the second most utilized payment method at PoS, highlighting a growing trend towards instant payment systems.
Recent statistics reveal that electronic payment transactions in Nigeria hit a record N1.07 quadrillion in 2024, reflecting a 79.6% rise from the previous year. The volume of e-payments also increased significantly, with the total number of processed transactions by NIBSS growing from 9.7 billion in 2023 to 11.2 billion in 2024, marking a 15.5% year-on-year increase.
Point-of-sale transactions soared to N19.4 trillion in 2024, representing an 81% increase from the N10.73 trillion recorded in 2023. Industry experts attribute this surge to various factors, including cash shortages experienced in early 2023 and the ongoing cashless policy implemented by the Central Bank of Nigeria (CBN).
The Global Payment Report illustrates the overall 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. It is projected that by 2030, digital payments will dominate e-commerce, constituting 65% of transaction value, while PoS digital payments may reach 47% of transaction value—a significant increase from just 1% in 2014.
In conclusion, Nigeria’s payment system is rapidly evolving toward digital transactions, with significant decreases in cash payments anticipated by 2030. The rise in access to digital payment methods, alongside improvements in financial inclusion and the push for a cashless economy, signifies a noteworthy transformation in the nation’s financial landscape. As e-payment methods continue to grow, Nigeria sets a precedent for others in the region aiming for similar advancements in digital finance.
Original Source: tribuneonlineng.com
