More Nigerians are running out of cash as the volume of financial transactions via mobile devices more than doubled in the past 11 months (January-November), according to data from the Nigerian Interbank Settlement System (NIBSS).

BusinessDay’s analysis of NIBSS data shows its volume rose 144.9 percent to 609.9 million in November from 249.0 million in the same period last year.

Its value also increased by 156.5 percent, from 6.9 trillion naira in November 2021 to 17.1 trillion naira in the same period this year.

In addition to mobile transfers, point of sale (PoS) also followed the same trend, with its volume increasing 25.3 percent to 1.1 billion from 877.9 million in the same period last year.

In value terms, it registered a 33.3% year-on-year rate of increase, from Naira 5.7 trillion to Naira 7.6 trillion.

A recent report from the World Bank’s Global Findex 2021 report indicated that increased adoption of mobile money is driving the growth of account ownership at financial institutions, particularly in sub-Saharan African countries such as Nigeria.

“Mobile money has emerged as an important enabler of financial inclusion in sub-Saharan Africa, especially for women, as a driver of account ownership and use through mobile payments, savings and loans,” she said.

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The report also said the country’s banked population increased by 15.6 percentage points to 45.3 percent in 2021, the highest in 10 years, from 29.7 percent in 2011.

“More consumers are switching to using electronic banking channels for financial transactions. Therefore, there is increased use of digital channels for mobile transactions and payments,” said Gbolahan Ologunro, a senior research analyst at Cordros Securities.

The transaction volume of the Nigeria Instant Payment (NIP) platform also increased to 4.6 billion in the 11 months, showing an increase of 53.3% from 3 billion in the same period last year.

Check transaction volume fell 9.5 percent to 3.8 billion from 4.2 billion during the same period, according to NIBSS data.

The transition from the old naira notes to the new ones, which have started to enter circulation, is expected to stimulate the use of electronic banking channels before the maturity of the old notes on January 31, 2023.

Damilola Adewale, a Lagos-based economic analyst, said people would limit the amount of cash they carry now, which could boost electronic transactions.

“Most likely, people will limit the amount of cash available by adopting electronic channels for their transactions because the expiration date of existing notes is January 2023,” he said.

A report titled ‘Instant Payments: 2020 Annual Statistics’ from NIBSS also indicated that COVID-19 had changed the landscape of electronic payments and accelerated the adoption of instant payments as people shift to electronic channels for exchanging funds.

In 2012, the Central Bank of Nigeria introduced the Cashless Policy, which was aimed at curbing excessive cash handling and reducing the volume of cash in circulation.

More importantly, the policy was introduced to boost the development and modernization of payment systems capable of placing Nigeria among the top 20 economies in the world.

Over the years, NIBSS says that Nigerian banks have exposed PINs to their customers through their various channels, including internet banking, bank branches, kiosks, mobile apps, USSD, PoS, and ATMs.