In Nine Months, Banks Generate N135.15bn From e-payments
The adoption of electronic channels for financial transactions has earned 10 deposit money banks about N135.15bn revenue in the first nine months of the year ended September 30.
Analyses of the unaudited 2019 third quarter reports of 10 banks showed that their revenue from electronic transactions grew by 57 per cent as against the N86.312bn they earned from January to September 2018.
The revenue was generated from the fees and commission that the banks charged their customers when they carried out transactions through Automated Teller Machines, USSD, Internet banking, Point of Sale payments, electronic bills payment and agency banking.
Some of the banks assessed were Zenith Bank Plc, First City Monument Bank Plc, Access Bank Plc, Guaranty Trust Bank Plc, United Bank for Africa Plc, Sterling Bank Plc and First Bank of Nigeria Limited.
Others are Jaiz Bank Plc, Fidelity Bank Plc and Wema Bank Plc.
Zenith Bank earned the highest income on its electronic platforms from January to September this year, reporting N35.32bn revenue, a 100 per cent revenue boost from N17.66bn in the corresponding period of 2018.
First Bank ranked second in the value of earnings from electronic payments, reporting N34.42bn revenue, a 46 per cent increase from the N23.59bn generated during the same period in 2018.
With N26.71bn revenue, United Bank for Africa recorded a 44 per cent increase in its electronic banking income in the nine months under review in 2019 as against N19.95bn earned in the same period in 2018.
Earnings from electronic transactions by GTB rose by 63 per cent from N6.77bn in January to September 2018 to N11.04bn in the same period in 2019.
Access Bank’s electronic business income in the first nine months of this year amounted to N8.85bn, an increase of 58 per cent over the N5.79bn revenue earned in the corresponding months in 2018.
FCMB’s earnings from electronic transactions also improved by 45 per cent to N7.98bn in January to September 2019 as against N6.013bn in the corresponding period in 2018.
Sterling Bank recorded N5.11bn income from electronic payments in the first nine months of the year and N3.44bn electronic payment earnings in the corresponding period of 2018, recording 48 per cent earnings growth.
With a total of N2.63bn reported for January to September 2019, Fidelity Bank’s digital payment earnings grew by 92 per cent from N1.37bn in the first nine months of 2018.
Wema Bank earned N2.79bn from its digital payment platform in the nine months under review, growing by 45 per cent as against the N1.93bn revenue in the same period in 2018.
Fees and commissions on digital payments earned by Jaiz Bank amounted to N307.55m as against the N34.68m it earned in the first nine months of 2018, recording 786.88 per cent growth.
The electronic payments have become a huge revenue earner for Nigerian banks as can be seen in the growing volume and value of electronic payments logged by the Nigerian Inter-Bank Settlement Scheme.
In 2018, electronic instant payments grossed N80.4tn on NIBSS platform, growing by 43 per cent year-on-year from N56.17tn in 2017.
Speaking on the changing trend of financial services delivery in the country in Lagos recently, the Executive Director, Inlaks, Tope Dare, said the financial technology companies would continue to compete with the traditional banks and disrupt the industry.
He noted that the impact of digitalisation was more intense in the financial services industry and banks had increased their investment in technology to automate their processes in response to customers’ demand.
“It is very certain that disruption in the banking sector will continue. Fintechs are competing with the banks for the same customers,” he said.
He added that banks that could transform into a truly effective digital bank would not only survive the threats but be relevant in the future.