Mobile payments in Nigeria rise by 184%, improvement attributed to regulator initiated financial reforms

NIGERIA – The latest data obtained from the Nigerian Inter-Bank Settlement Scheme (NIBSS) has revealed a remarkable increase in the value of payments executed by mobile agents in Nigeria.

According to NIBSS report, Nigerians executed N828.1 billion (about US$2.27 billion) worth of mobile payments in 2019, a 184 per cent increase from N292.02bn (about US$800 million) recorded in 2018.

The volume of mobile payments also grew by 470 per cent as agents aggregated 41.21 million payments in 2019 compared with 7.23 million in 2018.

NIBSS provides a platform for players in mobile payments to enable them to interoperate with banks and other financial institutions so as to offer a variety of services to their clients and subscribers.

There has been a steady growth in the value and volume of mobile payments since the Central Bank of Nigeria, in collaboration with other stakeholders, introduced the agency banking scheme to deepen financial inclusion.

The agent networks are now able to carry out BVN enrolment, cash-in, cash-out, airtime recharge, bills payment and funds transfer for customers in remote areas.

The CBN had last year issued super-agent licences to many financial technology companies, who in turn deployed agency banking services to remote locations across the country in order to facilitate and deliver convenient, accessible and cost-effective financial services.

The CBN, as part of its reforms in 2018, also gave telecommunications companies an opportunity to increase financial inclusion rates through the use of phone numbers to facilitate payments.

MTN for instance was granted a super-agent licence, allowing  it to set up an agent network that has started providing financial services to its existing subscriber base.

Also, 9mobile and Globacom have been granted Approval in Principle to operate a payment service bank in readiness for the financial transactions.

In line with the increasing volume and value of mobile payments, active Point of Sales terminals used by super agents have also been on the rise.

NIBSS’ data indicated that the number active PoS terminals grew by 40 per cent in one year from 217,283 terminals in December 2018 to 303,162 terminals as of December 2019.

Although the increase in mobile transactions has been impressive,  mobile money agents have complained that network disruptions and technology glitches were contributing significantly to declined transactions.

They noted that declined transactions were high during peak transaction periods and festive seasons and as a result impacting their bottom line as most of the issues were not resolved by banks in a timely manner.

The Chief Executive Officer, Shared Agent Network Expansion Facility, Ronke Kuye, has however revealed that SANEF was engaging banks on how to resolve issues faced by super agents in a timely manner.

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