After more than 4 months of steady growth, the value of PoS transactions carried out using Point of Sale (PoS) machines in Nigeria dropped by N59.26 billion in January.
According to the report released by the Nigeria Interbank Settlement System (NIBSS), the value dropped from its record highest of N372.68 billion in December 2019 to N313.42 billion by the end of January 2020.
Decrease in volume of PoS transactions
Similar to the value of PoS transactions, the total volume of PoS transactions also decreased by 4.8 million. The volume fell from 46.1 million in December 2019 to about 41.3 million in January.
The drop in volume could be due to the fear of being surcharged by the merchants. Last year, a PoS charge of N50 was imposed on PoS transactions by the Federal Government.
The imposition of PoS charges resulted in businesses including the additional fees to purchases made using PoS. Some merchants recalibrated their PoS to automatically deduct the charge in order to avoid disputes between customers, Others simply put up a notice for customers to know it’s being added.
Although the CBN later clarified that the N50 PoS charge was meant to be paid by the merchants and not the customers, Some merchants still went ahead to charge ignorant customers.
This factor may be responsible for the adverse effect seen in the report, as it shows Nigerians dropping the use of PoS.
Surprisingly, the total number of PoS deployed in the country increased even as the volume of transactions using PoS decreased. Deployment increased by about 3,200 from 303,162 in December 2019 to 306,409 in January.
There are about 306,409 PoS deployed in Nigeria
Similarly, the number of registered PoS terminals by the banks increased from 446,453 to 449,998 within the same period.
Decrease in volume of mobile transactions
Although the adoption of Mobile Inter-scheme Transaction increased exponentially throughout 2019. The value of transactions carried out using mobile dropped by N15.7 billion in the first month of 2020.
The report shows that the Value of mobile inter-scheme transactions dropped from N148.9 billion in December 2019 to N133.2 billion in January.
Similar to the value of transactions undertaken using mobile, the volume also experienced a drop of about 885,000 during the same period.
The total volume of transaction performed using Mobile Inter-scheme in January is 7,352,866
Decrease in value of NIBSS instant payment
Similar to PoS transactions and mobile transactions, the total value of transactions done using instant payment also dropped in January.
The NIBBS data showed that the total value of instant payments dropped by about N437.2 billion from the N10.7 trillion recorded in December 2019 to N10.2 trillion in January.
Also, the total number of instant payment deals recorded in January was about 111.3 million. This is about 15.2 million less than than the 126 million recorded in December 2019.
In Summary, the report shows a major decline in volume and value of transactions performed by PoS in January. It, however, also shows a slight increase in the adoption of cashless payments among merchants.
Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!