- Bank customers are resorting to fintechs as banks undergo system upgrades
- Fintechs reliability, transaction speed and other innovations make them stand out
- Fintechs have helped to drive financial inclusion and in exploring the digital payment goldmine
As was the case during the crash crunch in early 2023, occasioned by the naira redesign policy of the Central Bank of Nigeria (CBN), fintechs are coming to the rescue of Nigerians as banks undergo system upgrades.
With millions of customers in Nigeria in just a few years of operation, fintechs have redefined electronic banking with innovations like lightning speed, mobile, real-time, boundless transactions and cheaper or fewer charges.
Fintechs, such as Flutterwave, Opay, PalmPay, Moniepoint, Kuda, etc., have become widely accepted for these innovative approaches to banking, further widening their contribution to the growth of digital payments in Nigeria.
Their popularity may have been tested, approved and trusted during the now botched naira redesign and cashless policy of the CBN, leading to a significant cash crunch in the country. The fintechs demonstrated resilience during the period, ensuring transaction settlements that exposed vulnerabilities in many traditional banking platforms.
Fintechs to the rescue
The recent wave of bank system upgrades had many Nigerians resort to fintechs to carry out transactions.
The co-CEO of XChangeBOX, Abiola Jimoh, said fintechs have been helpful during the downtimes caused by the upgrade of bank systems.
Jimoh said, “If not for the new banks and fintech players stepping in just like they did during the cashless policy period, the situation would have been much worse. These delays affect trust in the entire banking ecosystem.
“Fintechs are helping to complement the efforts of traditional banks. We need to continue supporting them to ensure better user experiences and greater stability in the system.
“Compared to other nations, we don’t have enough fintech or banking institutions to fully serve our people. The sector is still evolving, and it needs continuous support for sustainable growth.”
Some Nigerians have also taken to social media, especially X and Facebook, to express how helpful fintechs have been during the disruptions to transactions occasioned by bank system upgrades and advising people to adopt them.
@yitsugee tweeted, “Still dealing with banking issues? It’s time to switch to Opay! They’ve been smooth sailing while others struggle.”
Queen Prevailer said, “If you’re using first bank, remove any money you intend to use in the next two weeks…go and remove the money now and put in your opay.”
Shehu Sambo said, “First Bank of Nigeria PLC announces temporary shutdown for system upgrade. Begins 26th October 2024 to 3rd November, 2024. If you bank with them, prepare for this and you can use alternate transaction plans like OPAY wallet and MONIEPOINT.”
Habila Dehchetilah Martin wrote, “Make una transfer all una money to opay ooo or any microfinance banks. Na so zenith bank dey show us shege banza.”
Bishop King Pharaoh said, “Access Bank has announced that it will temporarily shut services for a system upgrade 😌. Thank you OPAY 😎.”
Lovelyn Emmanuel Emeh wrote, “This is the time for you to get your own Opay card, as first bank re shutting down temporarily for 10 days for system upgrade. Don’t be left in the dark because of failed transaction. With Opay you re covered.”
Fintechs helping to explore the digital payment goldmine
In recent years, there has been an uptick in the adoption of electronic payment, mostly spurred by Nigeria’s young demographic, innovation of fintechs and the CBN’s policies on financial inclusion, especially the cashless policy.
The growth has also been reflected in the volume and value of transactions carried out through electronic payment channels. According to the Nigeria Inter-Bank Settlement System (NIBSS), electronic payment transactions increased by 55 per cent in 2023 to N600 trillion from N387 trillion in 2022, setting an all-time high since the introduction and adoption of electronic payment in the country.
There are indications that the volume and value of electronic transactions will increase further in 2024 given that the first quarter (Q1) of the year has seen a transaction value of N234 trillion, which is 89 per cent higher than the N123.9 trillion recorded in Q1 2023.
Increased adoption of electronic transactions has also strengthened the CBN’s efforts to curb excess liquidity and increase the government’s revenue. Already, the Federal Government aims to make N483.73 billion in three years (2023 to 2025) from electronic payments through Electronic Money Transfer Levy (EMTL).
The Budget Office estimated revenue in the three years to be N137.03 billion in 2023, N157.59 billion in 2024 and N189.11 billion in 2025. In 2023, the Federal Government made N180.31 billion from EMTL, which represents N43.96 million or 29.45 percent higher than its target for the year.
Charges now apply: Fintechs to charge N50 on transactions above N10,000
Financial technologies (fintechs) in Nigeria have announced the deduction of N50 transfer levy on transactions above N10,000 on customers' personal or business accounts beginning Monday, September 9.
In a message to customers on Saturday, September 7, titled, ‘FGN Electronic Money Transfer levy,’ Opay, one of the leading fintechs in the country, said the levy complies with the regulations of the Federal Inland Revenue Service (FIRS).