From Adanna Nnamani, Abuja
The Central Bank of Nigeria (CBN) has reported that transactions made through point-of-sale (POS) terminals have skyrocketed, surpassing ATM usage by an astonishing 603%.
In the first half of 2024, Nigerians conducted transactions worth ₦85.91 trillion via POS, a figure that dwarfs the ₦12.21 trillion recorded for ATM transactions during the same period.
This data is revealed in the CBN’s quarterly statistical bulletin for 2024.
The increase in POS transactions, representing a remarkable 77% rise from ₦48.44 trillion in 2023, indicates a broader trend towards electronic payments amid ongoing issues such as cash shortages at ATMs and long wait times for withdrawals.
The volume of POS transactions also saw a significant uptick, climbing from 4.87 billion to 6.39 billion, demonstrating a clear shift in consumer habits.
On the other hand, ATM transactions experienced a decline, dropping by 16.6% in value from ₦14.63 trillion in 2023 to ₦12.21 trillion in 2024, with the total number of ATM transactions falling from 519.52 million to 496.43 million.
Comparative analysis reveals that the growth of POS transactions is especially pronounced when compared with the previous year.
In 2023, as Nigeria grappled with cash scarcity, the value of POS transactions surged by 205% from ₦15.86 trillion in 2022, while the volume increased dramatically by 185%.
Although ATM transactions rose slightly in value during the same period, their decreasing volume suggests a shift towards fewer, larger withdrawals.
Further trends indicate that internet banking is also flourishing, with transaction values more than doubling from ₦462.17 billion in 2023 to ₦825.5 billion in 2024. The number of web-based transactions saw a modest rise as well, reflecting the growing adoption of digital banking solutions.
Mobile payment platforms are similarly thriving, with transaction values increasing by 64%, from ₦97.06 billion to ₦159.42 billion, and a 50% surge in transaction volume. This growth can be attributed to the increasing accessibility of smartphones and mobile banking services across Nigeria.
In contrast, cheque transactions continue their downward trajectory, despite a slight rise in value from ₦6.97 trillion in 2023 to ₦8.74 trillion in 2024. The volume of cheque transactions, however, fell from 8.13 million to 6.88 million, further highlighting a declining reliance on traditional banking methods.
The rapid digitalisation of Nigeria’s payment systems is evident, with POS, mobile payments, and internet banking leading the charge.
Despite the challenges posed by arbitrary fee increases, such as a 100% hike in POS charges reported in December 2024, many Nigerians have turned to POS for their cash needs, particularly as banks struggle to keep ATMs stocked.
The CBN has taken steps to address the cash availability crisis by imposing sanctions on nine banks for failing to provide adequate cash at ATMs during the festive season, resulting in fines totalling ₦1.35 billion. These fines, which will be deducted from the banks’ accounts with the CBN, signal the apex bank’s commitment to ensuring compliance with cash distribution guidelines.
Despite these measures, however, most Nigerians still rely on POS for their cash needs due to shortages at bank ATMs.
As the digital landscape continues to evolve, the reliance on POS terminals is expected to grow, reshaping the future of banking in Nigeria.