An increase in failed payment transactions in February caused a 4.83 percent drop in the value of cashless transactions, which fell to N37.67 trillion from N39.58 trillion in January 2023. Despite this decline in value, the use of e‑payment gateways surged, rising 41.29 percent month‑on‑month, according to new data from the Nigeria Inter‑Bank Settlement System (NIBSS). Cashless gateways were accessed 901.46 million times in February, up from 638 million in January. The higher usage alongside a lower total value indicates a rise in failed transactions.
The NIBSS has not updated its efficiency platform portal— which tracks the number of failed transactions and other metrics—since 2020, making it difficult to quantify the failures. As the country’s primary payment switch, the NIBSS records cashless activity from the Nigeria Instant Payment System (NIPS) and point‑of‑sale (PoS) terminals. In February, total NIPS transactions fell to N36.79 trillion from N38.77 trillion in January. Nevertheless, PoS transaction value grew from N807.16 billion in January to N883.45 billion in February, despite a scarcity of naira during the month.
Mobile transfers, the main payment gateway for many Nigerians, jumped 69.87 percent, from 108.14 million transactions in January to 183.69 million in February. However, the transaction value increased only marginally—by 7.88 percent—from N2.37 trillion to N2.56 trillion, reflecting widespread failed mobile transactions.
Since the Central Bank of Nigeria (CBN) announced its naira redesign policy and withdrawal limits in 2022, Nigerians have been compelled to adopt electronic payment methods. The CBN stipulated a maximum weekly cash‑withdrawal limit of N500,000 for individuals and N5 million for corporate organisations, urging customers to use alternative channels such as internet banking, mobile banking apps, USSD, cards/PoS, and eNaira. The surge in electronic payments has strained the banking sector, leaving many customers waiting and stranded. Complaints about failed transactions have trended on Twitter, with users tagging banks.
Seun Kuti‑George, Vice President of the Nigerian Association of Small‑Scale Industrialists, told The [publication] that a payment he made did not generate an immediate alert, forcing him to leave goods unattended until the next morning. He warned that in emergencies or contractual situations, such delays could be disastrous.
Bankers suggest that some failures stem from NIBSS not expanding its capacity to match the higher transaction volume. An anonymous First Bank employee reported increased downtime at NIBSS, affecting both outbound and inbound transfers, and called for capacity upgrades to cope with the CBN’s policy pressure. A payment‑industry source told The [publication] that the rise in mobile transfers is driven by pressure and inadequate infrastructure, adding, “I don’t think we are ready for this. The infrastructure is not robust enough to handle the volume of transactions we intend to do. Over time, the infrastructure will catch up, likely because the CBN will pressure banks and financial institutions to invest more.”
Other experts attribute many failed transactions to poor network infrastructure. Dr. Uju Ogunbunka, President of the Bank Customers Association of Nigeria, told The [publication], “You know the banks do not provide network services. Based on what we found out, there was a failure in the network system.”
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