Nigeria’s mobile transfers hit an all-time high of 108 million in January on the heels of CBN’s cashless drive

Mobile money transactions in Nigeria hit an all-time high this January, per the latest data from the Nigeria Inter-Bank Settlement System (NIBBS).

According to the NIBSS numbers, a total of 108.135 million transfers were made in January, representing a 237% increase when compared to the 32 million recorded during the same period in the previous year. Similarly, the value of mobile transactions rose by 124.8% to N2.4 trillion from N1.1 trillion in the period under review.

“It is very clear that more and more people are accepting the channels of payment that are available, and the platforms are stable. With stability, these components have grown,” Lilian Phido, Head of Corporate Communications, NIBSS, said.

Amid the current cash crisis due to the Central Bank of Nigeria’s (CBN) now-controversial naira redesign policy, Nigerians have turned to electronic payment channels to perform transactions. The entire process, for one, has been riddled with uncertainty and layers of controversies.

But experts say the surge in mobile transactions, as reported by the NIBSS, means the CBN’s push for a cashless Nigeria is bearing some fruits already.

Read also: As Nigeria makes herculean shift to cashless society, e-payment transactions record boom.

More Nigerians embrace e-payment transactions

The NIBSS figures show that Nigerians spent a total of N38.7 trillion over electronic channels in January 2023, representing a 45% year-on-year increase from N26.6 trillion in January 2022. In December 2022, the NIBSS recorded an all-time high monthly record of N42 trillion.

Though following a COVID-19-induced spike, this significant growth comes on the heels of the cashless policy of the Central Bank of Nigeria coupled with the naira redesign policy. The apex bank’s attempt to replace three higher-denomination currency notes to mop physical cash away from private vaults has since descended into chaos: long bank queues, a worsening cash crisis, and a pending Supreme Court case on the fate of the currency redesign policy.

Earlier today, Nigeria’s President Muhammadu Buhari extended the use of old N200 notes till April 10, while the old N500 and N1,000 cease to be legal tender. Instead, the notes can still be exchanged per new guidelines from the CBN.

According to the data released by NIBSS,  the volume of transactions processed via the NIBSS Instant Payments (NIP) platform dropped by 3.5% in January to 542.65 million compared to the December 2022 figure of 561.31 million. Similarly, the value of transactions done via the NIP platform went down by 7.74% from N42.023 trillion in December 2022 to N38.772 trillion in January.

However, the transaction volume and value had jumped by 55% and 45%, respectively, compared to the 348 million volume and N26.6 trillion value recorded in January 2022.

NIBSS data also reveals that Point of Sales transactions in Nigeria jumped to N807.16 billion in January 2023, a 40.69% year-on-year increase compared to the N573.72 billion reported in January 2022. By volume, PoS transactions in January 2023 amounted to 96.4 million, a 6.9% increase from what was recorded in 2022 at 90.1 million.

Read also: President Buhari extends the use of old N200 notes till April 10 amid Naira scarcity.

Mobile to the rescue

Registered mobile users in Nigeria did transactions worth N2.37 trillion in January 2023, a 125% increase from the previous year, the NIBSS data revealed. This implies that more Nigerians will embrace mobile transactions this year.

According to the latest Global Findex report by the World Bank, higher adoption of mobile money is driving the growth of account ownership in financial institutions, particularly in Sub-Saharan Africa (SSA) countries like Nigeria.

Per data from the Nigerian Communications Commission (NCC), active subscriptions for telecommunications services in the country — which boasts of Africa’s largest mobile population — stood at 222.5 million as of December 2022.

A report by GSMA, an umbrella organization representing mobile operators globally, predicted that Africa will add nearly 100 million new subscribers by 2025, as Nigeria, for one — being the most prominent mobile market on the continent — will gain 18 million new subscribers by that time.