Cash transactions in Nigeria rose to N237 trillion in the first quarter of 2024, according to new statistics from the Nigeria Interbank Settlement System.
According to data, this was an 88 percent increase from the N126 trillion reported in the first quarter of 2023.
BusinessDay analysis of the data revealed that electronic payment channels were used 3.09 billion times in the first three months, a 6.2 percent increase from the 2.91 billion times they were used in the corresponding period of 2023.
The NIBSS records cashless transactions from the Nigeria Instant Payment System and Point of Sales terminals. In the first three months, instant payment was N234.5 trillion, and PoS was N2.6 trillion.
Ifeanyi Caleb, a financial analyst, said Nigerians learned the hard way during last year’s naira scarcity and are now increasingly relying on electronic channels.
“I can tell you now that out of 10 small businesses in the street, eight will conveniently accept transfers compared to previous years when some merchants prefer accepting cash,” Caleb stated.
PoS transaction value and usage declined during the first three months of the year. The channel recorded N2.61 trillion worth of transactions, an 8.1 percent drop from N2.84 trillion in the corresponding period of 2023.
In terms of volume, it reported a 19 percent drop to 312 million from 386 million. According to Caleb, PoS transactions declined due to cash scarcity that lingered into 2024.
Also, the NIBSS data revealed that the number of Bank Verification Numbers increased to 61.4 million in April 2024 from 60.2 million in January.
This signifies that about 1.2 million registrations were made during the period. Experts believe that the recent announcement by the Central Bank of Nigeria regarding BVN drove this rise in numbers.
In December 2023, the apex bank directed commercial, merchant, non-interest, payment service banks, other financial institutions, and mobile money operators that the BVN or NIN attached to all accounts/wallets must be electronically revalidated by January 31, 2024.
The move followed the CBN’s efforts toward promoting financial system stability by strengthening the Know Your Customer (KYC) procedures in financial institutions.
