The value of electronic payment transactions rose year-on-year (YoY) by 298 percent to N135.52 trillion in the first quarter of the year (Q1’23) from N34.04 trillion in Q1’22, reflecting the impact of cash scarcity on the payment culture of Nigerians.
The cash scarcity, which lingered for more than two months, was a fallout of the implementation of the Naira Redesign policy of the Central Bank of Nigeria, CBN. The policy involved the redesign and release of N200, N500 and N1,000 naira notes.
The apex bank also announced that the old notes would cease to be legal tender by January 31st this year. After much pleading, the CBN moved the date to February 10th. While the CBN withdrew from circulation over N2 trillion of the old notes, the new notes were however not widely available. This led to cash rationing by banks, while PoS agents imposed exorbitant cash exchange charges, sometimes as high as 30% of the transaction value.
This development compelled most Nigerians to adopt electronic channels for payment of goods and services.
Reflecting the impact of this development, e-payment data from the Nigeria Inter-bank Settlement System (NIBSS) released yesterday showed that the number (volume) of e-payment transactions shot up by 984 percent to 4.7 billion in Q1’23 from 433.4 million in Q1’22, while the value rose year-on-year (YoY) by 298 percent to N135.52 trillion in the first quarter of the year (Q1’23) from N34.04 trillion in Q1’22.
Analysis of data showed that the value of e-payment transactions stood at N42.42 trillion in January but went down by 4.3 percent, month-on-month, to N40.6 trillion in February from where it rose by 34 percent to N54.5 trillion in March.
The volume of e-payment transactions stood at 1.12 billion in January rising by 29 percent, MoM to 1.45 billion in February and up by 46 percent, MoM to 2.13 billion in March.
NIBSS Instant Payment (NIP) channel had the highest value of transactions with N123.72 trillion and the largest volume of transactions with 2.5 billion during the period.
