Report: Mobile Payments Surge as Cheque Transactions Slide from 10.8m to 4.5m in 5yrs

Dike Onwuamaeze

The State of Enterprise (SOE) Report 2022 has revealed that financial transactions on mobile payment system grew by 5,455 per cent in Nigeria between 2017 and 2021, while cheque transactions went down from 10.8 million to 4.5 million transactions valued at N5.4 trillion and ₦3.2 trillion respectively within the same period. 

According to the report, over 326,000 agents and many other unidentified retail outlets are providing agency banking, while the number of  point-of-sale (POS) terminals deployed in 2021 was 915,519.  

The SOE report also showed that Nigeria’s financial institutions contributed ₦2.3 trillion to the country’s GDP in 2021, which was 3.2 per cent of the nation’s national output, and slightly higher than the N2.1 trillion it recorded in 2020.

The SOE report, which was launched recently by the EnterpriseNGR, said: “Nigeria’s Financial and Professional Services (FPS) sector has survived challenging times in the past 40 years, particularly recent recessions and the global pandemic.

“Nevertheless, the sector continues to rebound and post record growth in numbers of firms, job opportunities, innovations and improved services, as information shared in the report demonstrates. The growth can in part be attributed to the adoption of new technologies by consumers and service providers, which has been supported by key stakeholders, including regulators.

“With further support from ecosystem players — regulators, policymakers and operators — Nigeria’s Financial and Professional Services sector can reach significant milestones in years to come. Nigeria has the potential to lead the continent as Africa’s premier financial centre. Right now, evidence of this can be seen among FinTechs, where innovators and investors are riding the crest of successive technology waves to create a multibillion-dollar industry in Africa.”

Some of the highlights of the SOE Report 2022 that was unveiled by the Chief Executive Officer of the EnterpriseNGR, Ms. Obi Ibekwe, revealed that there were 21,917 registered members of the Institute of Chartered Accountants of Nigeria (ICAN) and over 120,000 registered legal practitioners in Nigeria as at June 2022, adding that there was an increasing appreciation of the need for insurance in the current business environment and accounted for 4.16 million Nigerians employed in the PSTS sector as at 2017, which was the latest available data.

EnterpriseNGR is the voice of Nigerian enterprises and a member-led advocacy group for the promotion of the growth and development of Nigeria’s Financial and Professional Services sector that comprised of financial institutions, lawyers, accountants, among others.

The SOE report also stated that “the unprecedented growth of alternative channels offering consumers access to financial services has been made possible by the near universal adoption of mobile telephony and digital technology in Nigeria.  

It said: “Since 2017, the volume and value of cheque transactions has fallen from 10.8 million transactions valued at ₦5.4 trillion to 4.5 million transactions estimated at ₦3.2 trillion in 2021.

“On the other hand, both the volume of electronic bill (e-bill) payments and mobile inter-scheme transactions grew exponentially by 32 per cent and 5,455 per cent, respectively, over the same period.”

It said that banks and other financial institutions were the third largest contributor to company income tax (CIT) receipts, valued at ₦96.4 billion, representing 12.2 per cent of CIT receipts generated locally, based on 2020 data, which is the  latest on the sector.  

The report stated that the FPS sector was the leading sector in terms of capital importation into the country despite the decline recorded in recent times in capital inflows from $9.7 billion in 2020 to $6.7 billion in 2021.

It said: “The FPS sector led other sectors in capital importation, principally by banks, attracting 21.8 per cent of imported capital, while Nigeria led sub Saharan African countries in diaspora remittances, receiving $19.2 billion compared to South Africa’s $0.9 billion; Kenya’s $3.7 billion and Ghana’s $4.5 billion.