Transactions through electronic payment (e-payment) channels increased by 17.93 per cent to N34.67 trillion in March 2022, from N29.4 trillion recorded in the previous month, a report by Financial Derivatives Company Limited (FDC), has shown.

While FDC, which usually cites data obtained from the Nigeria Interbank Settlement System (NIBSS), did not provide specific information about the volume and value of transactions recorded through the major e-payment channels such as Point of Sales (PoS) terminals, NIBSS Instant Payment (NIP), Mobile Inter-scheme and NIBSS Electronic Transfer (NEFT) in March, it said the increase in e-payment transactions during the period “reflects the improvement in E-commerce activities.”

It also predicted that the “value of transactions (will) increase towards N38trillion in April as Easter and Ramadan festive period sets in.”

New Telegraph’s analysis of the FDC’s reports on e-payment transactions for the first three months of 2022, indicates that it was only in the month of January that the value of the transactions dropped by 7.08 per cent to N28.7 trillion, compared to the N31.07 trillion recorded in December 2021.

The drop in e-payment transactions in January does not reflect the trend of the rapid growth in the e-payments industry as the FDC ascribed the decline to the “typical slowdown in consumer demand post-festive season.”

In fact, an analysis of data obtained from NIBSS shows that the value of transactions through most e-payment channels has maintained an upward trend in recent years.

For instance, the value of transactions through POS terminals in the country rose to N18.10 trillion between 2017 and 2021. Further analysis of the data shows that POS transactions maintained an upward trend in the last five years jumping by 356.27 per cent to N6.43 trillion in 2021 from N1.41 trillion in 2017.

Citing NIBSS’ data, New Telegraph recently reported that the number of Point of Sale (PoS) terminals deployed by financial institutions in the country headed north further to hit 955,234 in January this year from 915, 519 at the end of December 2021.

This implies that the financial institutions deployed a total of 39,715 of such terminals in the one month period. Also, compared with the 475,494 total number of deployed POS terminals in the country, as of January 2021, it means that deployment of the terminals increased by 100.89 per cent (479,740) between January 2021 and January this year.

Further breakdown of the data shows that there has been a steady increase in the number of deployed POS terminals in the last five years.

Thus, the total number of deployed POS terminals in the industry increased from 113,51 at the end of January 2017 to 159,579 and 223,098 at the end of January 2018 and January 2019 respectively.

The number of deployed POS terminals surged even further to 306,409 and 475,494 at the end of January 2020 and January 2021 respectively.

Analysts note that the surge in e-payment transactions, as well as the sharp increase in the number of deployed POS terminals, is driven by the growing adoption of electronic payment (e-payment) channels, in the last few years, which was accelerated by the impact of Covid-19.

Indeed, in its report titled: “Instant Payments – 2020 Annual Statistics,” the NIBSS stated: “COVID-19 changed the e-payments landscape, accelerating the adoption of instant payments as more people transitioned to electronic channels for funds exchange in the wake of government imposed lockdowns.”

Analysts also point out that the Central Bank of Nigeria’s (CBN) efforts to boost financial inclusion, which led it to introducing the Agent Banking system in 2013, under which, financial institutions and mobile money operators could appoint third parties as agents, equipped with PoS terminals, to provide financial services on their behalf to members of the public, has helped to increase the deployment of the terminals.

First Publised on NewTelegraph