Nigerian Banks Generated N438 Billion from Digital Transactions in 2023

An review of 10 financial institutions’ annual reports shows that digital banking channels generated around N438 billion in revenue in 2023.

Compared to the previous year, the financial organizations’ earnings from electronic transactions increased by 37.54 percent to N318.64 billion.

E-business revenue is generated through electronic channels, card products, and related services.

These channels include mobile apps, USSD channels, ATMs, agency banking, online banking, point-of-sale payments, and credit and debit card transactions.

The growing use of mobile and internet banking in Nigeria has contributed to the increase in electronic business income.

The PUNCH analyzed annual reports from FBN Holdings, Access Holdings, Guaranty Trust Holding Company, United Bank for Africa, Zenith Bank, Wema Bank, Fidelity Bank, FCMB Group, Stanbic IBTC Holdings, and Sterling Financial Holdings Company.

UBA led other banks in terms of electronic banking revenue, earning N125.58 billion, up from N78.94 billion in 2022.

Conversely, the banking group’s IT support and related expenses increased by 148% to N23.19 billion from N9.32 billion the previous year.

Access Holdings earned N101.62 billion from its electronic division, which includes transactions via electronic channels, card products, and related services.

This was approximately 70.34% greater than the electronic business income for 2022.

During the review year, the group’s IT and e-business expenses increased to N78.05 billion from N44.63 billion in 2022.

In its recently filed audited results, FBN Holdings earned N66.34 billion in earnings from its electronic division, up from N55.09 billion the prior year.

In a statement accompanying the annual report, the bank stated that electronic banking costs were a substantial contributor to the increase in fees and commission income.

“The underlying drivers of fees and commissions were led by electronic banking fees (20.4%) to N66.3 billion, letters of credit commission and fees (278.4%) to N60.6 billion, account maintenance fees (12.3%) to N22.3 billion, and funds transfer and intermediation fees (204.9%) to N20.6 billion.”

“Customer acquisition drive has also been enhanced through a growing adoption across digital platforms and greater penetration of the unbanked segments through the agency banking network, further boosting financial inclusion drive.”

In addition, Zenith Bank earned N51.82 billion from electronic banking fees in 2023, a 13.29% increase from N45.74 billion the year before.

During this year, the bank’s spending on information and technology increased by 8.48 percent to N33.59 billion, up from N30.97 billion in 2022.

GTCO’s electronic business income jumped to N40.83 billion from N37.74 billion the previous year, while its communications, administrative, and technological-related expenses rose to N50.24 billion from N42.39 billion.

In 2023, FCMB generated N17.69 billion in revenue from electronic fees and commissions, up from N13.99 billion the previous year.

The bank’s IT spending has nearly doubled to N16.57 billion from N9.99 billion.

Fidelity Bank’s earnings from e-business increased by roughly 20.30 percent to N14.03 billion from N11.66 billion in 2022.

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