Banks’ Q1 e-banking revenue up 12% against fintech incursion

Nigerian banks are not left behind in raking revenues from the provision of electronic banking services just like the financial technological companies. BusinessDay analysis shows that twelve out of fourteen banks recorded a 12.4 percent growth in their electronic-banking(e-banking) revenues in the first quarter of 2022 compared to the same period last year.

The banks, which include First Bank Holdings (FBNH), United Bank for Africa (UBA), Guaranty Trust Holding Company (GTCo), Access Holdings, Zenith Bank, Fidelity Bank, FCMB Group, Stanbic IBTC Holdings, Sterling Bank, Union Bank of Nigeria(UBN), Wema Bank, and Unity Bank, have continued to show resilience these past years.

Total income from the electronic businesses of Nigeria’s twelve publicly listed banks rose to over N77.39 billion in the first quarter of 2022, up from N68.87 billion recorded in the corresponding period of 2021, according to data compiled by BusinessDay.

Out of which the e-banking revenues made by tier 1 banks (FBNH, UBA, GTCo, Access, and Zenith) accounted for 86 percent. on the other hand, the tier 2 banks recorded higher growth rates in their e-banking revenues.

This is despite the rapid growth in fintech companies in Africa’s largest economy which have increased from about 50 in 2016 to over 300 in 2022.

Fitch Ratings, one of the three leading global ratings agencies, has said in its mid-year outlook for Nigeria that the country’s huge population presents opportunities to both commercial banks and fintech companies to grow.

The global ratings body gave this assurance in response to the concerns expressed by many industry stakeholders that the licensing of fintech companies to provide digital banking services in the country poses existential threats to Nigerian commercial banks.
Earnings from electronic banking include fees charged to customers for the use of digital channels, such as debit cards, mobile applications, USSD channels, POS, and other related online banking services.

These banks are benefitting massively from the wave of mobile phones adoption providing easy-to-use banking apps that are secure and operate seemingly like social media apps. Thereby boosting efficiency of operations and enhancing customer satisfaction by ensuring transactions are carried out expeditiously.

Access Holdings
Access Holdings recorded the highest e-banking revenue amongst its counterparts, amounting to N20.12 billion in the first quarter of 2022.
The group’s e-banking revenue represents a 12 percent increase from N17.9 billion recorded in the comparable period last year.

Its e-banking revenue accounted for 36 percent of its fees and commission income in Q1 2022. The holding company recorded N56.3 billion as fees and commission income in Q1 2022 up 44.5 percent from N38.9 billion in Q1 2021.

United Bank for Africa (UBA)
UBA ranked second with its e-banking revenue which stood at N15.11 billion in Q1 2022, representing 21 percent increase from N12.5 billion in the same period last year.

Its e-banking revenue accounted for 36 percent of its fees and commission income in Q1 2022. The bank recorded N42.1 billion as fees and commission income in Q1 2022 up 20.4 percent from N34.9 billion in Q1 2021.

Zenith Bank
Zenith came third with its revenue on electronic products which stood at N14.8 billion in Q1 2022, up 32.8 percent compared to N11.1 billion in Q1 2021.

Its e-banking revenue accounted for 44 percent of its fees and commission income in Q1 2022. The bank recorded N33.5 billion as fees and commission income in Q1 2022, up 16.7 percent from N28.7 billion in Q1 2021.

FBNH
First Bank’s Q1 2022 financials showed electronic banking income stood at N12.2 billion, a 15.4 percent decrease from N14.4 billion in the same period of 2021.

Its e-banking revenue accounted for 36 percent of its fees and commission income in Q1 2022. The holding company recorded N33.7 billion as fees and commission income in Q1 2022 down 0.93 percent from N34 billion in Q1 2021.

GTCo
GTCo recorded the least e-banking revenue compared to other tier 1 counterparts amounting to N4 billion in the first quarter of 2022.
The holding company’s e-banking revenue represents a 4.9 percent increase from N3.9 billion recorded in the comparable period last year.

Its e-banking revenue accounted for 18.9 percent of its fees and commission income in Q1 2022. The holding company recorded N21.3 billion as fees and commission income in Q1 2022 up 21.4 percent from N17.6 billion in Q1 2021.

FCMB
FCMB recorded a 10.5 percent increase in its e-banking revenue to N3.1 billion in Q1 2022 up from N2.8 billion in the same period last year.

Its e-banking revenue amounted to 41 percent of its fees and commission income in Q1 2022. The bank recorded N7.6 billion as fees and commission income in Q1 2022 up 34.6 percent from N5.7 billion in Q1 2021.

Union Bank
Union Bank recorded a 33.9 percent increase in its e-banking revenue to N2.1 billion in Q1 2022 from N1.5 billion in the same period last year.

Its e-banking revenue accounted for 60 percent of its fees and commission income in Q1 2022. The bank recorded N3.4 billion as fees and commission income in Q1 2022 up 10.6 percent from N3.1 billion in Q1 2021.

Sterling Bank
Sterling Bank recorded a 17 percent growth in its e-banking revenue to N1.9 billion in Q1 2022 from N1.6 billion in the corresponding period last year.

Its e-banking revenue accounted for 36.7 percent of its fees and commission income in Q1 2022. The bank recorded N5.1 billion as fees and commission income in Q1 2022 up 40 percent from N3.6 billion in Q1 2021.

Stanbic IBTC
Stanbic IBTC grew its e-banking revenue by 70.7 percent in the first three months of 2022. It recorded N1.2 billion up from N745 million in the same period last year.

Its e-banking revenue accounted for 5.9 percent of its fees and commission income in Q1 2022. The bank recorded N21.7 billion as fees and commission income in Q1 2022 up 4.3 percent from N20.8 billion in Q1 2021.

Fidelity Bank
Fidelity Bank’s e-banking revenue increased by 37 percent in the first three months of 2022. It recorded N1.23 billion as e-banking revenue up from N899 million in the same period last year.

Its e-banking revenue accounted for 17.7 percent of its fees and commission income in Q1 2022. The bank recorded N6.9 billion as fees and commission income in Q1 2022 up 33 percent from N5.2 billion in Q1 2021.

Wema Bank
Wema Bank recorded a 37 percent growth in its e-banking revenue to N787 million in Q1 2022 from N574 million in the corresponding period last year.

Its e-banking revenue accounted for 19.4 percent of its fees and commission income in Q1 2022. The bank recorded N4 billion as fees and commission income in Q1 2022 up 58.6 percent from N2.6 billion in Q1 2021.

Unity Bank
Unity Bank’s e-banking revenue declined by 13 percent to N767 million in Q1 2022 down from N882 million in the corresponding period last year.

Its e-banking revenue accounted for 51 percent of its fees and commission income in Q1 2022. The bank recorded N1.5 billion as fees and commission income in Q1 2022 down 6 percent from N1.6 billion in Q1 2021.