Nigerian banks collectively generated N438 billion from digital banking channels in 2023. This represents a 37.54% increase from the N318.64 billion recorded in the previous year.
An in-depth analysis of the annual reports of ten major financial institutions reveals this substantial growth.
The banks, which include 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, have seen a surge in revenue from their electronic business operations.
These operations encompass a variety of digital platforms such as mobile applications, USSD channels, automated teller machines (ATMs), agency banking, internet banking, and point-of-sale (POS) payments, as well as credit and debit card transactions.
Leading the charge was United Bank for Africa (UBA), which reported an income of N125.58 billion from its electronic banking channels, a significant increase from the N78.94 billion recorded in 2022.
This robust performance underscores UBA’s strong digital banking presence and customer adoption.
Access Holdings also demonstrated a substantial increase, recording N101.62 billion from its electronic business activities. This marks a 70.34% rise compared to the previous year’s earnings.
Similarly, FBN Holdings reported N66.34 billion in revenue from its digital channels, up from N55.09 billion in 2022.
The bank attributed this growth to a rise in electronic banking fees and a broader customer acquisition drive through digital platforms.
Zenith Bank’s earnings from electronic banking fees reached N51.82 billion, showing a 13.29% growth from the previous year’s N45.74 billion.
GTCO saw its e-business income rise to N40.83 billion, up from N37.74 billion.
FCMB also reported an increase in revenue from electronic fees and commissions, reaching N17.69 billion compared to N13.99 billion in the prior year.
Fidelity Bank experienced a 20.30% rise in its e-business earnings, totaling N14.03 billion. Sterling HoldCo reported N8.588 billion from e-business commissions and fees, an increase from N7.16 billion.
Wema Bank, which prides itself on being the pioneer of Africa’s first fully digital bank, ALAT, saw its digital fees grow to N7.35 billion from N6.13 billion.
Stanbic IBTC Holdings, although reporting the least income from electronic business among the reviewed banks, still saw significant growth, with earnings rising to N4.42 billion from N2.51 billion in 2022.
The increase in digital banking revenues reflects a broader trend of technological adoption within the Nigerian financial sector.
Analysts have identified the shift towards mobile and online banking as a key driver of this growth, a trend accelerated by the COVID-19 pandemic which pushed more customers towards digital solutions.
Afolabi Olowookere, Managing Director and Chief Economist at ADSR, highlighted the sector’s robust growth and its increasing contribution to Nigeria’s Gross Domestic Product (GDP).
He noted, “The sector is growing, hence its contribution to the GDP will also grow. After COVID-19, the financial sector and ICT have been growing because people do a lot of transactions online.”
As digital banking continues to expand, Nigerian banks are expected to further invest in technological advancements and enhance their digital platforms, driving greater financial inclusion and offering more convenient banking solutions to customers nationwide.
