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POS transactions in Nigeria hit over N3 trillion in H1 2021

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The value of point of sales transactions made in Nigeria jumped to N3.01 trillion in the first half of 2021, with a total volume of 462.11 million transactions in the same period.

This is according to the report released by the Nigeria Inter-Bank Settlement System (NIBSS) for the month of June 2021.

This represents a 50% increase compared to N2 trillion recorded in the corresponding period of 2020 and a 10.3% increase against N2.72 trillion recorded in the second half of 2020. The increase in the value of POS transactions in Nigeria shows the spending patterns of Nigerians and payment preferences as compared to cash payments.

Highlights

  • Value of POS transactions increased by 10.3% in H1 2021 from N2.72 trillion recorded in H2 2020 to N3.01 trillion in the review period.
  • However, the value of transactions has been on a steady decline since March 2021, when it hit its peak. In the month of June 2021, POS transactions declined marginally by 0.01% from N503.96 billion to N503.91 billion.
  • The volume of POS transactions stood at 462.11 million in the review period, representing a 66% year-on-year increase compared to 278.28 million transacted in H1 2021.
  • It is worth noting that on a month-on-month comparison, transactions through POS terminals rose from 79.07 million in May 2021 to 81.97 million in June 2021. It also reflects a massive surge when compared to 49.42 million transactions recorded in the corresponding period of 2020.

A cursory look at the data revealed that the current value of POS transactions in Nigeria represents the highest on record since 2017. In the same vein, another electronic payment channel, NIBSS Instant Payment (NIP) systems also rose to its highest on record in H1 2021, from N97.29 trillion in H2 2020 to N123.38 trillion in the current review period.

What is driving growth?

The Nigerian e-payment sector continues to demonstrate significant growth resolve, as Nigerians are steadily increasing their preference for cashless payments as against holding and transacting in cash.

  • Insecurity in Nigeria is a major cause for choosing to go with the former rather than the latter. It is easier and safer to make payments through your ATM or virtual cards in Nigeria, especially with the increased cases of robbery, bag snatching, kidnapping amongst others.
  • The rigour of waiting in line to be serviced in the bank just to make withdrawals has made POS businesses grow significantly since the heat of the covid-19 pandemic. Recall that during the lockdown, when most Nigerians were forced to stay home and banks were only partially operating, POS terminals became a viable option in making withdrawals and transferring funds.
  • While interviewing Miss Esther Oyewole, a POS agent in Lagos State, she mentioned how the business had blossomed since the lockdown and how many Nigerians were moving into the sector.
  • She explained that she made an average of N15,000 as profit daily, summing up to about N450,000 in a month, from which she had been able to employ other young people and set up branches in various strategic places.
  • According to Miss Esther, “POS businesses have recorded significant growth, and are poised to continue growing, as Nigerians still do not feel safe going around with cash when they could travel light and still complete their transactions anywhere in the country.”

According to NIBSS, the number of registered POS terminals in the country rose to 976,898 in June 2021, just a little under 1 million, compared to 523,488 registered as of the same period in 2020. Meanwhile, deployed POS machines as of June 2021, stood at 638,983.

Why this matters

The increase in e-payment transactions in Nigeria is a reflection of Nigerians growing adoption of cashless transactions. The growth in the number of POS businesses in the country has also formed a major source of employment for Nigerians, especially youths.

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Building learning culture is difficult when the environment is not conducive – Nestle Nigeria

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Building a learning culture in early childhood is difficult when the environment is not conducive.

This was stated by Nestle Nigeria through its Corporate Communications and Public Affairs Manager, Mrs. Victoria Uwadoka, on Saturday while commissioning a fully equipped block of 3 classrooms renovated in Salvation Army Primary School 1, Agbara, Ogun state.

According to her, the pupils will now enjoy a more conducive environment with the commissioning of the block, as this is part of a project comprising 2 blocks of 5 classrooms and a crèche.

She said, “Building a learning culture in early childhood is difficult when the environment is not conducive. This is why we are committed to improving facilities in the schools closest to our operations. Strong in the belief that access to quality education increases opportunities for a better quality of life, Nestlé Nigeria has invested in enhancing infrastructure in public schools, reaching over 4,000 children in Ogun State and Abaji in the FCT in the past 3 years alone.

“The company achieves its objective of building thriving communities in collaboration with the State Universal Basic Education Boards to support government’s efforts to reposition the education sector for improved performance.”

This fact was appreciated by the Executive Secretary of the Ogun State Universal Basic Education Board, Mr. Olalekan Kuye who said, “I specially commend Nestlé Nigeria PLC for this laudable intervention which complements our collective drive to further improve the state of our learning environment. These projects are also unique and in accordance with recommended standards.

“I charge the school, management committee and community development association and our esteemed learners to judiciously utilize and ensure that the buildings are well secured and preserved for continuous use.”

In his comments at the project handover ceremony, the Alagbara of Agbara, HRM Oba Lukman Jayeola Agunbiade said, “I am delighted that the commissioning of the classroom blocks renovated by Nestlé Nigeria is taking place during the celebration of my 5th year in office as the Alagbara of the illustrious Agbara community.

“I sincerely appreciate Nestlé for remaining a responsible member of this community, and for investing in improving teaching and learning facilities in Salvation Army Primary School among others. I am therefore pleased to receive this project on behalf of my people.”

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The future lies in a knowledge-based economy – Sanusi

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A former governor of the Central Bank of Nigeria, Alhaji Muhammad Sanusi, has said that Nigeria’s future lies in a knowledge-based economy.

This, he disclosed at the closing ceremony of the Kaduna Investment Summit, tagged KadInvest 6.0, according to Daily Trust.

What the former CBN governor said

Sanusi said the future lies in a knowledge-based economy, adding that Nigeria is behind many African countries in innovation index.

“Only eight of every 100 Nigerians who start primary school complete university.

“Globally, work is being redefined; 30 to 40 per cent of workers in developed economies will need to significantly upgrade their skills by 2030. And what are the major drivers of this redefinition? ICT and remote working, which we have seen even here with COVID-19.

“There is increased automation and artificial intelligence. Very soon, robot will take over work in most countries and those who would have job are those who operate the robots, manufacture the robots or service the robots.”

He stated that Nigeria can not continue depending on revenue from oil as the world economy is slowing moving away from oil into alternative energy sources.

“A few months ago, Germany was able to produce enough renewable energy for the entire country’s need. Today, we are having difficulties selling Nigerian oil. So, not only are we having problems producing, even when we produce, the market is not there.

“So, this is forcing a change, and for us a country that depends on oil, things need to change.”

He, however, stressed the need for skill creation for the young people which will create enabling environment for economic growth and development.

“Data is one of the most crucial support that can be given to entrepreneurs for innovation,” he said.

While calling on government to encourage market access, he said, “If Kaduna state government continues with its e-government plan, it will be a big market itself and it will encourage investment which are all knowledge economy aspiration and a shift in government spending to match the priority.”

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Nigeria Railway: FG leveraging alternatives to fund railway development – Amaechi

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The Federal Government through the Minister of Transportation, Rotimi Amaechi, revealed that it is leveraging alternative funding mechanisms to rehabilitate old rail lines and modernise the rail system in line with its 25-year strategic vision.

The Minister disclosed this at the 2021 annual public lecture organised by the Department of Economics, Faculty of Social Science, University of Lagos, Akoka, themed “Nigeria’s National Rail Transport Project,” reported by the News Agency of Nigeria.

He said the FG recovered most of the failed locations on the Narrow Gauge corridor and is also taking precautions in the Environment Impact Assessment (EIA) report on the standard gauge corridors. He stated that the establishment of rail projects was aimed at reducing the cost of transportation and boosting the economy; since economic activities drive development in any country.

He also added that all the regions in the country would have been connected with rail transportation but for lack of sustainable funding plan, environmental issues, degenerated infrastructure, theft of railway materials and obsolete legal framework.

“The railway project is affected by decline of requisite railway professionals, indiscriminate disposal of refuse on railway right of way by citizens among others,” he said.

The minister urged community leaders and civil society organisations to join in the fight against vandalisation of railway infrastructure across the country.

Unilag Vice-Chancellor, Prof. Oluwatoyin Ogundipe, said when transport systems are efficient, they provide economic and social opportunities and benefits that result in positive multiplier effects such as better access to markets, employment, and additional investments.

“Availability of railway also plays an important role in reducing regional disparities and improving the competitiveness of regions, by facilitating trade, movement of labour, and economies of scale.

“In a vast country like ours, where the population are not only scattered all over the country but are also separated by desert, forest, valley and mountains, efficient, reliable, and cheap means of transportation like modern railway networks are essential,” Ogundipe said.

What you should know

Recall that it was reported in July that the Minister of Transport, Rotimi Amaechi, revealed that the Federal Government has committed the sum of $280 million for the $1.2 billion Kaduna-Kano rail project which is set to begin this month.

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