By Ayomide Otitoju
Point of Sale (POS) terminals processed transactions worth ₦223.27 trillion in 2024, nearly doubling the ₦110.35 trillion recorded in 2023, as Nigerians increasingly embraced digital payments over cash withdrawals, data from the Central Bank of Nigeria (CBN) has revealed.
According to figures from the apex bank’s quarterly statistical bulletin, POS transaction volume jumped by 32.7 per cent year-on-year, from 9.85 billion in 2023 to 13.08 billion in 2024. In contrast, Automated Teller Machine (ATM) transactions saw minimal growth, rising from 1.012 billion to 1.022 billion transactions.
The value of ATM withdrawals increased slightly to ₦29.12 trillion from ₦28.21 trillion, underlining a shift in consumer preference towards cashless transactions. Monthly data showed consistent growth in POS usage throughout the year, with the value peaking at ₦31.84 trillion in December.
In January 2024, POS terminals processed ₦11.50 trillion, more than double the ₦5.28 trillion recorded in January 2023. By June, transaction value soared to ₦19.57 trillion, up from ₦8.31 trillion a year earlier. The trend continued through the second half of the year, with September recording ₦19.69 trillion and November posting one of the highest monthly spikes at ₦29.42 trillion.
While POS transaction volume continued to rise, ATM usage by value remained relatively flat. December witnessed the highest ATM withdrawal value at ₦3.91 trillion, a moderate rise from ₦2.43 trillion in 2023, despite widespread reports of cash shortages at ATMs nationwide.
This shift in consumer behavior has been largely driven by the growing footprint of agency banking networks, which have expanded access to POS services across both urban and rural areas. However, the surge in digital payment usage has not been without challenges.
In December, many POS agents increased charges by up to 100 per cent, collecting ₦200 per ₦5,000 transaction amid cash scarcity. Customers faced empty ATMs and cash rationing at bank branches, with withdrawal limits of ₦10,000 to ₦20,000 in many locations.
Despite CBN directives mandating banks to ensure ATM cash availability, several Deposit Money Banks were penalized for non-compliance. Nine banks, including First Bank Plc, Zenith Bank Plc, UBA Plc, and Fidelity Bank Plc, were collectively fined ₦1.35 billion after spot checks revealed failures to meet cash distribution standards.
The increased reliance on POS channels has also raised concerns about fraud. According to FITC’s Fraud and Forgeries report for Q1 2024, POS fraud incidents surged by 31.12 per cent, rising from 2,683 cases in Q4 2023 to 3,518 in Q1 2024. POS-related fraud accounted for 30.67 per cent of the total 11,472 fraud cases reported in the quarter.
To curb rising fraud and enforce its cashless policy, the CBN introduced a daily cash-out limit of ₦100,000 per individual through POS agents and capped agents’ withdrawals at ₦1.2 million daily. Customers are now limited to ₦500,000 in weekly cash withdrawals.
In addition, the CBN directed that all agency banking activities be conducted through designated float accounts, and terminals must be integrated with the Payments Terminal Service Aggregator. Banks are also required to electronically submit daily transaction data to the Nigerian Inter-Bank Settlement System (NIBSS).
The circular reiterated that financial institutions would be held responsible for the conduct of their agents, with provisions for sanctions and monetary penalties in cases of violations.
The rise in POS usage reflects a broader trend towards digital payments, driven by convenience, speed, and increasing financial inclusion. However, stakeholders warn that growing concerns around security, regulatory compliance, and transaction costs must be addressed to sustain this momentum.
