Digital payment penetration in Nigeria, others hit 46% – Report
Digital payment penetration in Nigeria and other African countries has grown from 23 per cent to 46 per cent in less than eight years.
This has continued to drive growth in digital commerce, a study by EBANX titled, ‘Beyond Borders,’ has revealed.
The digital payments firm disclosed that rising economies like Brazil, India, Kenya, and Nigeria are pulling the global digital market up with the rise of online purchases with instant payments, transfers, and other alternative payment methods.
It stated that cards were still strong in digital payments. Most new consumers (34 million) that will embrace digital payments are to come from India, the firm noted.
It stated that Africa and Latin America would not be left behind with the general consumer increase ensuring that the digital commerce markets in both regions surpass $1tn in total value by 2026.
The President of Global Payments at EBANX, Paula Bellizia, said, “There is a solid demographic reason for this: rising economies have a young and growing population, contrasting developed regions. In addition to the demographic and economic push, rising economies largely benefit from digitisation.
“The digital revolution has been disrupting industries and unlocking opportunities for both local and global players, from verticals spanning from SaaS, digital ads, and B2B online trade to gaming, streaming, social media, and e-commerce. And payments have been the backbone of this growth.”
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The study highlighted that digital commerce is growing by 13 per cent or 12 per cent per year in more consolidated markets around the world, like the U.S. or Europe, but is expanding at a much faster pace in rising economies by 20 per cent.
It noted that as an early adopter of digital payments, and soon to be home to an adult population of 1 billion by 2030, Africa will become an important region for the digital growth of commerce and payments.
The firm declared, “After heavily embracing digital payments, which jumped from a 23 per cent to a 46 per cent penetration rate considering many of its countries in less than eight years, Africa is now on the verge of its next big leap: digital commerce, fuelled by cell phone penetration rates and constant adaptability of local, alternative payment methods to the online world, like mobile money, which reached almost universal penetration in countries like Kenya.”
Commenting on specific countries, the firm noted that already 42 per cent of Kenyan businesses and 63 per cent of Indian ones make online purchases.
It added, “By 2027, rising markets in LatAm, Africa and Apac will make up for 40 per cent of the total value of B2B payments made online worldwide, and yet an estimated 70 per cent of B2B transactions are still pretty much manual, according to Capgemini, lacking more seamless flows.”
Digital payments have been on the rise in Nigeria. According to statistics from the Nigeria Inter-Bank Settlement System, Nigerians used electronic gateways 1.35 billion times in March 2023, 448.54 million times more than the 901.46 million times they did in February 2023.
Also, cashless transactions grew by 44.84 per cent to N126.73tn in the first quarter of 2023 from N87.49tn in the corresponding period of 2
