A new report from Visa, titled Value of Acceptance: Understanding the Digital Payment Landscape in Nigeria, highlights significant growth potential for digital payments, particularly within small and medium-sized enterprises (SMEs).
The study found that nearly 90% of SMEs surveyed believe digital payments boost their revenue and customer footfall. In a positive shift towards modernisation, 76% of cash-only SMEs plan to invest in new payment technologies.
The findings reveal a strong preference for digital payments among Nigerian merchants, with 83% viewing it as essential for growth. Digital payments are praised for increasing sales, reducing fraud, and enhancing customer convenience. Despite concerns over payment failures and fraud, the positive outlook on digital payment adoption is clear, with more than half of the merchants already opting for digital transactions.
Andrew Uaboi, Vice President & Head of Visa West Africa, remarked that Nigeria’s digital payments landscape is rapidly evolving, holding promise for both SMEs and the broader economy.
To unlock the full potential of digital payments, Visa stresses the need for improved financial literacy, better awareness of digital payment benefits, and incentives for customers. With 76% of cash-only SMEs planning to acquire point-of-sale (POS) devices, Visa sees a clear opportunity to accelerate the shift to digital payments by simplifying onboarding processes.
To address fraud concerns, Visa advocates for educational campaigns to highlight the security advantages of digital payments, especially card payments, which carry a lower fraud risk.
Digital payments help SMEs by boosting revenue, improving customer satisfaction, reducing cash-handling risks, and providing valuable transaction data. This data can facilitate easier access to financing, thus supporting business growth.
Digital transactions also drive broader economic benefits by connecting the unbanked to the formal financial system, improving financial inclusion, and promoting long-term GDP growth. A mere 1% increase in card usage, for example, could lead to a $67 billion annual increase in consumption.
Visa is positioning itself as a key partner in Nigeria’s shift to a more digital economy, offering a range of solutions, from Tap to Phone and Contactless Payments to educational resources for businesses. Visa’s expertise and cybersecurity capabilities aim to help build trust and drive the adoption of digital payments.
