In the first quarter of 2024, Nigeria experienced a significant downturn in Point-of-Sale (POS) transactions, with transaction values dropping by N225.73 billion compared to the same period in the previous year.
This decline, marking a 7.94% fall in POS system usage, coincided with a surge in currency outside banks.
The analysis, based on data from the Nigeria Inter-Bank Settlement System (NIBSS) and the Central Bank of Nigeria (CBN), offers insights into the financial habits of Nigerians.
While the CBN has not yet released data for March 2024, limiting the analysis to February 2024, it provides a snapshot of cash circulation trends.
In January 2024, POS transaction values showed a slight increase, reaching N850.09 billion, surpassing figures from January 2023. However, this growth was short-lived, as transaction values decreased to N805.05 billion in February 2024 and further to N961.86 billion in March 2024, compared to the corresponding months in 2023.
Overall, the total value of POS transactions in Q1 2024 amounted to N2.62 trillion, falling short of the N2.84 trillion recorded in Q1 2023.
Similarly, transaction volumes declined throughout the quarter, with January witnessing an initial rise to 112.78 million transactions, followed by decreases in February and March.
The decline in both transaction values and volumes, totaling 314 million transactions for Q1 2024, suggests a shift in consumer transaction behavior.
This reversal of the cashless trend seen in the aftermath of the cash scarcity in Q1 2023 may indicate normalization or the emergence of new patterns in consumer spending.
