Cards have been the fastest growing payments instrument since 2010, as cheque use has declined consistently and significantly, Dipo Fatokun, CBN Director, Banking & Payments System Department said.
Cards, credit transfers, direct debits and e-money are non-cash payment instruments with which end users of payment systems transfer funds between accounts at banks or other financial institutions.
Debit cards are the fastest growing (12.8 per cent) payments instrument in 2014, recording the highest share (45.7 per cent) of global e-payment transactions.
Dipo described e-payment system that allows the use of electronics system to initiate, authorise and authenticate the transfer of money between two persons.
He said global non-cash volumes are projected to have increased by 10.1 per cent to reach $426.3 billion in 2015, aided by high growth in emerging economies across the world, including Africa even as the Nigerian e-payments industry has been evolving in line with the evolution in global payments in both Wholesale and Retail systems.
Further, electronic payment transaction volumes hit $387.3 billion in 2014 recording an increase of 8.9 per cent driven by accelerated growth in developing markets.
“Banks, PSPs, and the CBN have played various roles in developing the payments system and creating products and channels for electronic payments.
The Retail Payments Transformation Programme of the CBN has led to the introduction of various electronic payments products and services by operators in the industry.
The electronic products are gradually reducing the usage of cheques and cash, as noticed consistently in the annual performance report since the inception of the Cash-less Policy in 2012,” he said.
He said the volume and value of transactions based on cheques and National Electronic Funds Transfer (NEFT) have been consistently reducing yearly since 2013, while same data for the Nigeria Interbank Settlement System- NIBSS Instant Payment (NIP), Automated Teller Machine (ATM), and mobile money channels have been on the increase.
This is an indication of users’ preference for instant value channels over non-instant payment channels, he added.
Continuing: “The ATM Channel accounts for the highest volume of transactions, while the NIP accounts for the highest value of transactions annually.
This is because the ATM is usually the e-payment channel that new and lower value account holders always interface with, while corporates and upwardly mobile middle class customers make transfers using NIP,” he said.
Financial institutions and other e-payment service providers operate in a highly regulated environment. The regulation of electronic payments in Nigeria which started with the CBN Electronic Banking Guidelines, issued in August 2003.
“Regulation is necessary to ensure that operators focus on delivering products and services that enable compliance, efficiency, financial stability and a positive customer experience.