Nigerians Switch to POS as ATM Withdrawals Drop and Transactions Hit N223tn in 2024
The use of Point of Sale (POS) terminals across Nigeria reached a record high in 2024, handling transactions worth a staggering N223.27 trillion, more than double the N110.35 trillion processed in 2023. This significant growth is detailed in the Central Bank of Nigeria’s (CBN) quarterly statistical bulletin, which shows a major shift from Automated Teller Machines (ATMs) to POS for financial transactions nationwide.
According to the data, the volume of POS transactions rose from 9.85 billion in 2023 to 13.08 billion in 2024, marking a 32.7% increase year-on-year. Meanwhile, ATM transactions remained relatively stagnant, with only a marginal rise from 1.012 billion to 1.022 billion transactions over the same period. In monetary terms, ATM withdrawals in 2024 totaled N29.12tn, up slightly from N28.21tn in 2023. This clearly illustrates Nigerians’ growing preference for digital payments and agent banking systems over traditional ATM withdrawals.
Monthly figures further highlight this trend. In January 2024 alone, POS terminals processed N11.50tn, more than double the N5.28tn recorded in January 2023. In stark contrast, ATM withdrawals plummeted from N3.24tn in January 2023 to N2.15tn in January 2024. This pattern continued in February with POS transactions hitting N12.46tn, a 69% rise from N7.38tn the previous year, while ATM withdrawals slightly declined from N1.77tn to N1.72tn.
In March 2024, POS usage climbed to N14.73tn, up from N10.62tn in March 2023. At the same time, ATM withdrawals fell further to N1.60tn, down from N2.16tn. April maintained the momentum, with POS handling N13.74tn compared to N8.55tn in April 2023, while ATM usage dropped to N1.81tn from N2.41tn.
The shift was more evident by mid-year. June 2024 saw POS transactions jump to N19.57tn, more than doubling the N8.31tn in June 2023. ATM transactions during that month stayed relatively flat at N2.45tn, despite a rise in the number of withdrawals, indicating more frequent but smaller cash withdrawals.
In the third quarter, July POS figures surged to N15.24tn, an 83% increase from N8.31tn a year earlier. ATM transactions, however, rose to N3.21tn, the highest monthly withdrawal so far. August POS transactions stood at N18.90tn, doubling the N9.10tn in August 2023, while ATM usage edged up slightly to N2.21tn from N2.14tn.
By September, POS usage reached N19.69tn, up from N9.40tn, while ATM figures rose to N2.30tn from N1.99tn. In October, POS soared to N22.27tn—a significant leap from N10.60tn—while ATM usage fell to N1.93tn, marking the lowest point in the year.
The year closed with even more dramatic growth. POS transactions hit N29.42tn in November and peaked at N31.84tn in December 2024, more than double the N13.20tn recorded the previous December. ATM withdrawals followed with their highest volume in December at N3.91tn, a jump from N2.43tn in December 2023.
This rise in POS usage was largely driven by the expansion of agency banking networks, which brought financial services closer to Nigerians in both urban and rural areas. However, despite its convenience, the shift has exposed users to high transaction charges and increased fraud risks. In December 2024, POS agents raised their service fees by 100%, charging N200 for every N5,000 withdrawn. This was fueled by a nationwide cash scarcity, leaving many Nigerians dependent on POS services as bank ATMs ran dry.
Frustration grew as banks turned customers away or limited cash withdrawals to N10,000 or N20,000 per day. Despite a stern warning from the CBN threatening sanctions, some banks failed to keep ATMs loaded with cash. As a result, the apex bank fined nine Deposit Money Banks—including Fidelity Bank, First Bank, UBA, Zenith Bank, and others—a total of N1.35 billion for violating ATM cash availability rules.
Contributing further to the crisis was the enforcement of the Electronic Money Transfer Levy (EMTL), a N50 charge applied to any electronic deposit or transfer of N10,000 and above. Starting December 1, 2024, this levy was enforced on all fintech platforms such as OPay, Moniepoint, and Kuda, which account for about 70% of POS market share. This policy, coupled with limited access to physical cash, pushed more users towards POS terminals despite rising charges.
The boom in POS usage also came with a spike in fraud. According to the FITC’s Fraud and Forgeries Report, POS-related fraud cases increased by 31.12% in Q1 2024, jumping from 2,683 in Q4 2023 to 3,518 cases. POS fraud alone made up 30.67% of all reported fraud incidents, making it the most targeted transaction method in the period under review.
In response, the CBN introduced new restrictions. POS agents were capped at N100,000 in daily cash-outs per customer, with a total daily agent limit of N1.2 million. Weekly cash withdrawals for individual customers were set at N500,000. Furthermore, all transactions must go through float accounts, and agent terminals must connect to the Payments Terminal Service Aggregator (PTSA). Detailed daily transaction data must also be submitted electronically to the Nigerian Inter-Bank Settlement System (NIBSS).
The CBN also stated that bank principals would be held accountable for their agents’ actions. The regulator warned of penalties such as fines and administrative sanctions for any breaches, promising periodic monitoring and random checks to enforce compliance.
Despite these challenges, the massive growth in POS usage reflects a transformation in Nigeria’s financial ecosystem, signalling an ongoing embrace of digital payments and cashless policies. However, to sustain trust and ensure efficiency, regulatory bodies and financial institutions must improve oversight, curb exploitation, and strengthen fraud prevention strategies.
