According to a recent KPMG report, Nigerians’ weekly ATM usage decreased from 70% in the previous few years to 40% in 2023.
The “In Pursuit Value” research collected customer experiences from 2023 through a survey of bank clients in Ghana and Nigeria.
The poll claims that because cash is frequently unavailable in many ATMs, ATM usage in Nigeria has significantly decreased.
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It went on to say that the survey’s medium digital transactions fell from the top ten to outside the top ten.
It stated, “Currently, four in ten customers report weekly ATM usage, a notable decline from the previous seven in ten over the last few years. This decline in ATM us- age coincides with a significant rise in agency banking usage, with six in ten customers frequenting bank agents every week”
The report further noted that the rise in agency banking emphasizes the continued popularity of cash, underscoring customers’ quest for more readily available cash options, primarily driven by the popularity of bank agents across the nation.
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Furthermore, the survey noted that payment via digital mediums rose by 52% in 2023 between January and October according to NIBSS data.
It explained that the spike in digital payments was triggered by the cash crunch occasioned by the CBN’s naira redesign policy in the first quarter of 2023.
It stated, “Consequently, digital payments surged, marking a notable 52% increase in total NIBSS Instant Payment (NIP) transactions by October 2023 compared to January of the same year. This was triggered by the Central Bank of Nigeria’s initiative to overhaul the Naira, aiming to regulate cash circulation and reduce reliance on physical currency”
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It further explained that the rise in digital payment overwhelmed Tier-1 banks with multiple cases of transaction failure but fintechs such as Opay, PalmPay, and Moniepoint rose to the challenge leading to a significant change in customers’ preferences.
According to the survey, 58% of respondents switched banks or had reasons to change to fintechs during the period. This presents a radical shift from the 15% who switched banks in 2022.
Also, around 13% of retail banking respondents now rely on fintech for their primary banking needs from the 4% who made the switch in 2022
