Nigeria’s economy recorded 39 per cent jump to N8.03tn in the value of Point of Sale (PoS) transactions in 2022, data from the Nigeria Interbank Settlement System (NIBSS) has shown.
The data showed that the aggregate PoS transactions between July 2020 and July 2021 were estimated at N5.77tn. However, between July 2021 and July 2022, the volume of transactions increased to N8.03tn, indicating a 39.16 per cent increase over the period.
PoS transactions increased from a total volume of 921.19 million between July 2020 and July 2021, to 1.20 billion from July 2021 to July 2022.
According to the NIBSS, July 2022 alone recorded the highest number of PoS transactions registered at 2.067 million in just one month.
According to the Deputy President of the Lagos Chamber of Commerce and Industry (LCCI), Gabriel Idahosa, the primary factor responsible for the recorded value of PoS transactions was an increase in the supply of services and a strong market.
“First, the central bank approves payment services such as Momo Money from MTN and Smart Cash from Airtel.”
He noted that the rise of fintech companies and the use of technology for awareness of this payment method were also major propellers.
“Then, you have a lot more fintech companies advertising payment services. Organisations are allowing payments on their platform. Now, power companies allow payment of electricity bills over PoS, and even some government services let you do that. All the schools, both primary and secondary, allow you to use PoS too. Also, the banks have been very aggressive in promoting their PoS services.”
Idahosa noted that the culture of cashless policy was also fast becoming a trend largely due to the lingering impact of the COVID-19 period.
“The culture of non-cash payment is catching up very fast. Even for the illiterate that ordinarily cannot use the service, the increasing offer of USSD service which you can do over your phone means that many people with cellphones can now make payment.
“These were initially triggered by COVID-19 when people could not easily walk to the banks to cash. So, during that time, banks were partially closed for some time, and it became difficult. Those people who were not familiar with electronic payment options now began to learn it. And now, it is the preferred mode of payment.”
Commenting on the increase, an economist, Bismarck Rewane, said that the increment was influenced by technological advancement.
“There’s a shift from cash and cheques to electronic payment. That’s why there has been an increase. There is broadband penetration, more mobile phone subscribers, and Nigerians are becoming more internet-savvy. So, they are making payments electronically rather than going by brick and mortar.”
A Senior Lecturer at Pan Atlantic University, Dr. Olusegun Vincent, further explained that the increase was inevitable due to inflation.
“Inflation is part of the surge. Prices of goods and services have gone up. Another major aspect is the issue of insecurity. People are being very careful. That’s why they adopt PoS because of the ease of payments. You will discover that if you don’t use PoS, you can’t get money. Most Automated Teller Machines are often running out of funds. So, nobody wants to waste time and they go to the merchant.”
He added that the national acceptance of electronic payment was a revolution, and the central bank never foresaw this amount of adoption.