Naira redesign policy pushes banks’ earnings from cashless transactions to N279bn in 9 months

The naira redesign policy of the Central Bank of Nigeria (CBN) has led to an increase in banks’ profits from cashless transactions to N279.85bn in the first nine months of 2023, an analysis of their financial reports has shown.

This represents a 29.89% increase when compared to the N215.44bn raked in in the corresponding period in 2022.

The naira redesign policy was implemented in the early part of 2023 forcing many Nigerians to embrace electronic forms of payment, leading to a spike in the volume of cashless transactions.

This is in line with the apex bank’s prediction in its Payments Vision 2025 document that stated that “The use of cash will naturally slow with the ‘mobile first generation’, which will be economically active by 2025, hence one of the focuses of the PSV 2025 is enhancing the cashless policy of the CBN.

“As we implement the PSV 2025 agenda, the CBN will continue to ensure that the Nigerian payments system is widely utilised domestically, supports the government’s financial inclusion objectives, and meets international standards while contributing to overall national economic growth and development of Nigeria.”

Further analysis of the bank’s financial reports indicated that United Bank for Africa earned the highest from electronic fees, raking in N75.75bn during this period, while Jaiz Bank made N696.03m, emerging as the lowest earner, though it was a 78.55 per cent rise from N389.82m in the prior year.

In the period under review, Wema Bank Plc grew its e-banking earnings by 104.17 per cent to N5.21bn from N2.55bn.

READ ALSO:Nigerian banks lose N9.5bn in first eight months of 2023

Unity Bank Plc’s earnings declined by 18.44 per cent to N2.22bn from N2.72bn and Zenith Bank’s earnings declined by 6.98 per cent to N33.55bn from N36.07bn.

Fidelity Bank Plc’s electronic banking channel fee rose by 26.92 per cent to N2.85bn from N2.24bn.

United Bank for Africa grew earnings from e-channels by 57.95 per cent to N75.75bn, while Access Holdings Plc revenue from this stream increased by 42.412 per cent to N70.35bn.

Guaranty Trust Holding Company and its subsidiaries made N30.91bn from e-banking fees, a 14.70 per cent increase from the N26.95bn it made in the corresponding period of 2022.

FBN Holdings earnings increased by 22.04 per cent to N48.79bn from N39.98bn, Sterling Financial Holdings Company Plc and Subsidiaries earnings increased to N6.30bn from N5.57bn, and Stanbic IBTC Holdings Plc earnings jumped to N3.24bn from N1.63bn.

Banks are expected to continue to rake in more than modest fees from electronic banking channels as more Nigerians embrace cashless transactions.

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