By Mary Onyia
The Central Bank of Nigeria (CBN) has disclosed that transactions on Point-of-Sale (PoS) terminals surpassed Automated Teller Machines (ATMs) usage by seven times and more in the 12 months of 2024.
According to the apex bank, while transactions on ATMs totaled N12.21trilion in 2024, N12.21trillion was recorded for POS in the same period under review, bringing total transactions made by Nigerians to N85.91trillion in the year.
This data, sourced from the CBN’s quarterly statistical bulletin, reflects a significant shift in consumer preferences as POS becomes the dominant payment method, and the lack of cash at ATMs and lengthy queues persist.
When compared to 2023, the value of POS transactions saw a 77 percent increase, rising from N48.44 trillion to N85.91tn, while the volume of transactions grew by 31 percent, from 4.87 billion to 6.39 billion.
This growth can be attributed to the widespread availability of POS terminals and the ease they provide for cashless transactions across the country.
In contrast, ATM transactions dropped in value from N14.63 trillion in 2023 to N12.21 trillion in 2024, a 16.6 percent decline, while their volume also fell slightly, from 519.52 million to 496.43 million.
Comparing 2023 to 2022, POS transactions demonstrated more robust growth, as the country battled cash scarcity at the end of 2022 and the start of 2023.
The value of transactions jumped by 205 percent, from N15.86 trillion in 2022 to N48.44 trillion in 2023, while the volume surged by 185 percent, from 1.71 billion to 4.87 billion.
Meanwhile, ATM transactions showed a mixed trend during this period. The value rose from N12.64 trillion in 2022 to N14.63 trillion in 2023, representing a 15.8 percent increase.
However, the volume dropped significantly from 713.69 million to 519.52 million, suggesting that while fewer transactions were conducted, they were of higher value.
These figures highlight the reduced reliance on physical cash withdrawals as electronic payments gain traction.
Further analysis reveals that Internet banking transactions more than doubled in value, rising from N462.17 billion in 2023 to N825.5 billion in 2024.
The volume of web-based transactions also increased, albeit modestly, from 11.32 million to 11.64 million.
Similarly, mobile payment platforms continued to record strong growth, with the value of transactions rising from N97.06 billion to N159.42 billion, a 64 percent increase.
The volume of mobile transactions surged by 50 percent, from 2.33 billion to 3.49 billion, reflecting the growing adoption of smartphones and the accessibility of mobile banking services.
Cheque transactions, however, continued their decline, a reflection of the dwindling reliance on traditional banking methods.
The value of cheque transactions in 2024 increased slightly to N8.74 trillion from N6.97 trillion in 2023, a 25.5 percent rise, but the volume fell from 8.13 million to 6.88 million, marking a 15 percent decline.
The data highlights the rapid digitalisation of Nigeria’s payment systems, with POS, mobile payments, and Internet banking leading the charge.
The surge in POS transactions occurred despite the arbitrary increase in charges common towards the end of the year.
In December 2024, POS agents hiked charges by about 100 percent, collecting up to N200 per N5,000 withdrawals.
Many Nigerians were at the mercy of POS operators as most banks’ ATMs were empty.
Likewise, banks turned back their customers citing a lack of cash, and in rare cases where customers were able to get cash, they were limited to withdrawals of between N10,000 to N20,000.
This happened despite a warning to the banks by the CBN that any bank found not dispensing cash via ATMs would be sanctioned.
It would be recalled that the CBN recently sanctioned nine banks with fines totaling N1.35bn for failing to ensure cash availability via ATMs during the festive season.
Each bank was fined N150m following spot checks that revealed non-compliance with the apex bank’s cash distribution guidelines.
The affected banks include Fidelity Bank Plc, First Bank Plc, Keystone Bank Plc, Union Bank Plc, Globus Bank Plc, Providus Bank Plc, Zenith Bank Plc, United Bank for Africa Plc, and Sterling Bank Plc.
The fines will be directly debited from the banks’ accounts with the CBN.
investigations revealed that high POS transaction charge persists even after the festive period.
Earlier, POS operators attributed the increase to severe cash scarcity caused by banks rationing withdrawals and the implementation of the Electronic Money Transfer Levy of N50 by the Federal Inland Revenue Services charged on any electronic inflow of N10,000 and above.
The stamp duty or electronic money transfer levy is a single, one-off charge of N50 on electronic receipt or transfer of money deposited in any commercial money bank or financial institution on any type of account on sums of N10,000 and above.
On December 1, 2024, the Federal Government began enforcing the policy across fintech platforms such as OPay, Moniepoint, Kuda, and others.
The fintech operators dominate about 70 percent of the POS agent market.