The value of cashless transactions decreased by 4.83 percent to N37.67 trillion in February from N39.58 trillion in January 2023 due to an increase in failed payment transactions.
According to new data from the Nigeria Inter-Bank Settlement System, this occurred at a time when the utilization of e-payment gateways experienced a month-over-month increase of 41.29 percent.
Cashless gateways were utilized 901.46 million times in February, compared to 638 million times in January. The total value of cashless transactions decreased in February despite an increase in usage, indicating an increase in the number of unsuccessful transactions.
It is difficult to report the number of failed transactions because the NIBSS has not updated its efficiency platform portal since 2020, which lists the number of failed transitions and more.
As the significant installment switch in the country, the NIBSS records credit only exchanges from the Nigeria Moment Installment Framework and Retail location terminals. From N38.772 trillion in January, the total NIP (instant payments) decreased to N36.79 trillion in February.
The NIBSS data showed that the value of PoS transactions increased from N807.16 billion in January to N883.45 billion in February despite the lack of naira.
From 108.14 million times in January to 183.69 million times in February, mobile transfers, which serve as the primary payment gateway for many Nigerians, saw a 69.87 percent increase in usage.
Transaction value only slightly increased from N2.37tn in January to N2.56tn in February, despite a significant increase in usage. This was similar to what many Nigerians had to deal with during the month, when multiple mobile transactions failed.
Nigerians have been forced to use electronic payment methods ever since the Central Bank of Nigeria announced in 2022 its naira redesign policy and withdrawal limits.
“The maximum weekly limit for cash withdrawals across all channels by individuals and corporate organizations shall be N500,000 and N5m respectively,” the apex bank stated in announcing its policy.
“Customers should be encouraged to use alternative channels (such as Internet banking, mobile banking apps, USSD, cards/POS, eNaira, etc.)” was added. to carry out their financial transactions
Related News Kaduna govt insists on e-payment in hospitals FG to generate N484bn from e-payment channels despite naira scarcity Kaduna govt insists on e-payment in hospitals despite naira scarcity The pressure of increased electronic payment has overwhelmed the banking sector, leaving many customers waiting and stranded.
Nigerians have been tweeting about failed transactions and tagging banks. Seun Kuti-George, Vice President of the Nigerian Association of Small-Scale Industrialists, recently stated to The PUNCH: “I made a payment to someone one morning, and they did not receive the alert immediately.
I had to leave the goods there until the following morning in the hope that the man would wake up. I would have lost that if it were an emergency, a life or death situation, or a contract that would be canceled.
Numerous bankers have suggested that the NIBSS’s inability to adapt to the rising volume of transactions may have contributed to some of these failures.
The NIBSS had been experiencing more downtime due to the pressure of transactions, according to an anonymous First Bank banker.
The banker claims that transfer outflow and inflow have been affected by this downtime. The banker stated that the payment switch must increase its capacity to withstand the CBN’s policy’s pressure.
A source in the payment industry recently told The PUNCH that pressure and a lack of robust infrastructure are to blame for the rise in mobile transfers.
“I don’t think we are ready for this,” the source stated. I believe that the infrastructure isn’t strong enough to handle the number of transactions we want to do.
“So, what I accept is over the long haul, the framework will get up to speed. As a result of the CBN’s pressure on financial institutions to invest more, this is likely to occur.
Additionally, a number of experts have stated that inadequate network infrastructure is to blame for many unsuccessful transactions. Dr. Uju Ogunbunka, who is in charge of the Bank Customers Association of Nigeria, recently stated to The PUNCH, “You know the banks do not provide network services.” We discovered that there was a problem with the network system.