Nigeria’s transition to a cashless economy gained significant momentum in 2024, with the value of electronic transactions surging by 79% to a record N1.08 quadrillion, according to the latest data from the Nigeria Inter-Bank Settlement System (NIBSS).
The NIBSS Instant Payment (NIP) platform, an account-based, real-time interbank payment solution introduced in 2011, has been instrumental in driving this growth, ensuring instant value transfer to beneficiaries.
An analysis of the data revealed a steady rise in electronic transactions throughout the year. Starting at N72.11 trillion in January, transaction values peaked in the last quarter, reaching N103.21 trillion in October, N109.53 trillion in November, and N115.12 trillion in December. Notably, January’s figure, the lowest for the year, still surpassed all monthly transaction values recorded in 2023, underscoring the increasing adoption of digital payment methods.
In terms of volume, electronic transactions grew by 13.69%, rising from 11.69 billion in 2023 to 13.92 billion in 2024. May recorded the highest transaction volume at 1.02 billion, while June saw the lowest at 871.66 million.
The Central Bank of Nigeria (CBN) has been a key driver of this shift, implementing policies to reduce the reliance on physical cash. Effective January 9, 2023, the CBN revised its cash withdrawal limits for individuals and corporations, aiming to curb the circulation of physical cash and promote electronic payments for goods and services. The policy is part of broader efforts to lower banking costs, enhance financial inclusion, improve monetary policy effectiveness, and reduce cash-related crimes such as banditry, ransom-taking, and terrorism financing.
The impact of these measures is evident in the rising financial inclusion rate, which increased to 74% in 2023 from 68% in 2020, according to the EFInA Access to Finance Survey. However, 26% of Nigerians remain financially excluded, highlighting the need for continued efforts to bridge the gap.
Sarafadeen Fasasi, National President of the Association of Mobile Money and Bank Agents in Nigeria, attributed the growth in digital transactions to the expansion of agent networks across the country. “Financial inclusion aims to bring the unbanked into the formal banking system and encourage digital transactions. The increase in agents has enabled even petty traders to transact digitally, reducing the need for cash transfers,” he said. Fasasi also praised NIBSS for improving its platform reliability, noting a significant reduction in downtime and failed transactions.
Economists and analysts have welcomed the trend but cautioned against potential risks. Marcel Okeke, an economist and sustainability expert, described the surge in electronic transactions as a positive development but warned of the growing threat of cybercrime. “While this progress is commendable, we must strengthen cybersecurity measures to protect users and maintain trust in the system,” he said.
Rotimi Fakayejo, a financial analyst, highlighted Nigeria’s leading position in e-payment adoption globally. “Nigeria’s e-payment system is one of the most effective worldwide, even surpassing countries like the U.S. in terms of transaction frequency. The 2023 cash scarcity further accelerated trust in digital payments, reducing risks associated with physical cash,” he noted.