Despite the ongoing cash scarcity, Nigerians registered mobile transactions worth N2.37 trillion in January 2023, representing a staggering 125 per cent increase.
This is according to recent data from the Nigeria Inter-Bank Settlement Systems (NIBSS).
That means that volume of mobile transactions in Africa’s largest economy increased by 55 percent year on year to 108.1 million, compared to 32.6 million transactions in January 2022.
Whilst the value rose by 125 percent year on year, it fell slightly when compared to the transaction value of N2.48 trillion, recorded in December 2022, the highest on record.
It should be noted that the month of December is also known for higher spending due to the Christmas and New Year’s celebrations in most parts of the country.
Analysis of the NIBSS report revealed that transaction volume and value have surged by over 50 per cent and 18 per cent respectively since the announcement to introduce new naira notes.
Total transaction volume and value was N709 billion and N2 trillion at the end of October 2022.
In particular, the value of NIP (NIBSS Instant Payments) increased by 46 per cent to N38.77 trillion in January 2023, up from N26.65 trillion in the same period in 2022. It fell by 7.7 per cent when compared to the previous year’s figure of N42.03 trillion.
The volume of NIP transactions increased by 55 per cent year on year to 541.65 million, up from 348.4 million in January of last year.
In the same month, POS transactions in the same currency increased by 41 per cent to N807.16 billion. In the same period in 2022, it stood at N573.7 billion.
Nigerians have faced severe cash shortages in recent weeks after the Central Bank of Nigeria (CBN) in October opted to redesign higher naira denominations (N1000, N500 and N200) and phase out old notes. The original deadline for using the old notes was January 31, 2023, but this was later extended to February 10.
However, due to the limited number of new notes in circulation, cash transactions have been difficult to consumate in the country, with many people having to wait in long lines at banking halls, ATMs, and point of sale (PoS) machines to obtain cash.
Some have had to pay up to 50 per cent more to withdraw money from PoS machines across the country.
Due to the country’s current cash shortages, most bank customers have been compelled to use alternative banking channels including mobile banking, NIP, and the Point of Sale terminals.
On the other hand, experts say the growth trend could have been higher than what was recorded in January, given the need for Nigerians to complete transactions despite a lack of cash.
However, the banking sector’s deficit has frustrated many Nigerians in the last two weeks, as they have experienced significant delays with their mobile transactions, including unsuccessful debited transfers, inability to access bank mobile apps, and network failures, among other things.