Cash is king. For decades, that truism has held in Nigeria, a country with a famously huge informal economy. Yet, recent trends show that customer behaviour is changing and digital payments and transfers are now just as popular as cash, according to Moniepoints Informal Economy Report 2024.
Low trust historically drove the insistence on cash payments and NIBSS instant payment NIP also tapped into this trust problem. While instant payments became popular, many players in Nigerias informal economy resisted them for years because of a distrust for Nigerian banks which had their fair share of troubles in the 90s.
There was also the fact that bank transfers sometimes took hours to confirm and could cause long wait times for the customer. However, faster transfer times are changing that. A naira redesign that led to a cash crunch in February 2023 also propelled digital payments.
Per Moniepoints Informal Economy report , customers of informal businesses prefer to pay with cards 24, while transfers are also popular 18. Cash, which has historically been king, is the third preferred payment method 15.2 for customers.
For business owners, cash 53.1 is just as popular as cards 23.1.
