In a remarkable shift towards a cashless economy, Nigerians conducted transactions worth an astonishing N85.91 trillion through Point-of-Sale (POS) terminals in the first half of 2024. This figure eclipses the N12.21 trillion recorded for Automated Teller Machine (ATM) transactions during the same period, marking a staggering 603% increase, according to data released by the Central Bank of Nigeria (CBN).
The CBN’s quarterly statistical bulletin highlights a profound transformation in consumer behavior, as POS transactions emerge as the preferred payment method amidst persistent cash shortages at ATMs and lengthy withdrawal queues. Compared to 2023, the value of POS transactions soared by an impressive 77%, rising from N48.44 trillion to N85.91 trillion, while the volume of transactions grew by 31%, climbing from 4.87 billion to 6.39 billion.
This surge can be attributed to the widespread availability of POS terminals and their convenience in facilitating seamless cashless transactions across urban and rural areas.
In stark contrast, ATM transactions continued their downward trend, with their value dropping by 16.6%, from N14.63 trillion in 2023 to N12.21 trillion in 2024. Similarly, the volume of ATM transactions experienced a slight decline, falling from 519.52 million to 496.43 million.
These figures underscore a growing consumer shift away from physical cash withdrawals, favoring digital payment options instead.
The upward trajectory of POS transactions over the past two years reflects Nigeria’s gradual transition to a digital economy. Between 2022 and 2023, as the country grappled with cash shortages and banking disruptions, the value of POS transactions skyrocketed by 205%, from N15.86 trillion to N48.44 trillion, while the volume surged by 185%, from 1.71 billion to 4.87 billion.
During this same period, ATM transactions presented a mixed picture: while the value increased by 15.8%, from N12.64 trillion to N14.63 trillion, the volume plummeted from 713.69 million to 519.52 million, indicating fewer but higher-value withdrawals.
The digital transformation of Nigeria’s financial sector isn’t limited to POS transactions. Internet banking transactions more than doubled in value, from N462.17 billion in 2023 to N825.5 billion in 2024. Web-based transaction volumes also edged up from 11.32 million to 11.64 million, signaling modest but consistent growth in online banking adoption.
Mobile payment platforms saw even more dramatic gains, with transaction values surging by 64%, from N97.06 billion to N159.42 billion, and transaction volumes rising by 50%, from 2.33 billion to 3.49 billion. These figures highlight the growing penetration of smartphones and the increasing ease of mobile banking services.
Traditional banking methods such as cheque transactions continued to wane. Although the value of cheque transactions rose by 25.5%, from N6.97 trillion in 2023 to N8.74 trillion in 2024, the volume fell sharply by 15%, from 8.13 million to 6.88 million. This decline reflects a steady shift away from paper-based payments towards faster, digital alternatives.
The surge in POS transactions was not without challenges, as arbitrary increases in service charges became prevalent towards the end of the year. Despite these issues, the data underscores the rapid digitalisation of Nigeria’s payment ecosystem, with POS, mobile payments, and internet banking leading the charge in reshaping how Nigerians transact.
The unprecedented growth of digital payment systems signals a transformative era for Nigeria’s financial landscape. As electronic transactions continue to gain traction, the Central Bank’s drive for a cashless economy appears to be gaining ground, paving the way for greater efficiency, financial inclusion, and reduced reliance on cash.
With POS terminals now a cornerstone of daily commerce, Nigeria stands at the forefront of Africa’s digital payment revolution, embracing a future where convenience, speed, and innovation drive economic activities.
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