Mobile financial transactions in Nigeria nearly doubled in the first seven months of 2024. Data from the Nigeria Interbank Settlement System (NIBSS) revealed a 74% increase in mobile money transfers, from ₦23.8 trillion in the same period of 2023 to ₦41.5 trillion by July 2024. This sharp rise reflects the growing adoption of mobile banking in the country, driven by convenience and improving financial access.
The Rise of Mobile Banking
Mobile money has proven to be a key enabler of financial inclusion in Nigeria. According to economic analyst Damilola Adewale, consumers prefer the speed and ease of transferring funds via mobile devices instead of visiting physical bank branches. As mobile technology improves and more services become available, the accessibility of banking solutions has expanded, offering users an efficient alternative to traditional banking.
Growth in Mobile Connections
Supporting this surge in mobile transactions is Nigeria’s vast mobile network. As of March 2024, data from the Nigerian Communications Commission showed that there were 219 million mobile connections. This immense connectivity lays the foundation for a thriving mobile money ecosystem, enabling even remote users to access financial services with ease.
Financial Inclusion and Sub-Saharan Africa
The World Bank’s 2021 Global Findex report highlights the role of mobile money in driving account ownership and usage in Sub-Saharan Africa (SSA), including Nigeria. In 2021, the banked population in Nigeria increased significantly to 45.3%, up from 29.7% in 2011. Mobile money solutions have played a crucial role in this growth, particularly among women, by providing opportunities to make payments, save, and borrow through mobile platforms.
The Growth of Cashless Transactions
Alongside mobile money, NIBSS reported a rise in total cashless transactions, which surged by 84.37%, reaching ₦572.63 trillion in the first seven months of 2024. This figure is close to the total for the entire year of 2023, signaling a shift towards electronic banking channels as more Nigerians embrace digital payments.
Shifting Consumer Behavior
Gbolahan Ologunro, senior research analyst at Cordros Securities, attributes this growth to the increasing adoption of electronic banking. Consumers are increasingly favoring digital channels over cash, a trend that accelerated during the pandemic. The transition to electronic payments was further accelerated by COVID-19 lockdowns in 2020, which forced businesses and consumers alike to adapt to online transactions.
COVID-19’s Impact on E-Payments
NIBSS’ 2021 report on instant payments confirmed that the pandemic marked a turning point in Nigeria’s payment landscape. Lockdowns and restrictions on physical interactions prompted widespread adoption of e-payments, leading to a significant rise in digital transactions. The preference for electronic payments has since continued, shaping a new era in Nigeria’s banking ecosystem.
Conclusion
The rapid growth in mobile money and cashless transactions in Nigeria is a reflection of the country’s broader efforts toward financial inclusion. With increasing mobile connections, enhanced digital services, and the influence of global trends, Nigeria is witnessing a transformation in the way its population accesses and manages finances. As mobile banking continues to evolve, it is expected that these trends will further deepen the financial inclusion of underbanked communities across the country.
