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The Cards And Payments Industry In Nigeria: Emerging Trends And Opportunities To 2020

Published on: Mar 2017 | From USD $2750 | Published By: GLOBAL DATA | Number Of Pages: 51

The Cards and Payments Industry in Nigeria: Emerging Trends and Opportunities to 2020

Summary

GlobalData’s "The Cards and Payments Industry in Nigeria: Emerging Trends and Opportunities to 2020" report provides top-level market analysis, information and insights into the Nigerian cards and payments industry, including -
- Current and forecast values for each market in the Nigerian cards and payments industry, including debit and credit cards.
- Detailed insights into payment instruments including credit transfers, checks and payment cards. It also, includes an overview of the country's key alternative payment instruments.
- E-commerce market analysis.
- Analysis of various market drivers and regulations governing the Nigerian cards and payments industry.
- Detailed analysis of strategies adopted by banks and other institutions to market debit and credit cards.
- Comprehensive analysis of consumer attitudes and buying preferences for cards.
- The competitive landscape in the Nigerian cards and payments industry.

The report provides detailed analysis of market trends in the Nigerian cards and payments industry. It provides values and volumes for a number of key performance indicators in the industry, including credit transfers, checks and payment cards during the review period (2012–2016).

The report also analyzes various payment card markets operating in the industry, and provides detailed information on the number of cards in circulation, transaction values and volumes during the review period and over the forecast period (2016–2020). It also offers information on the country's competitive landscape, including the market shares of issuers and schemes.

The report brings together GlobalData’s research, modeling, and analysis expertise to allow banks and card issuers to identify segment dynamics and competitive advantages. The report also covers details of regulatory policy and recent changes in the regulatory structure.

The Nigerian payment cards market is anticipated to slow down, as a result of a ban imposed by the Central Bank of Nigeria (CBN) in December 2015 on the use of debit and credit cards abroad, and on transactions denominated in foreign currencies. This prevented Nigerian consumers from using cards to make purchases during overseas travel, or from foreign e-commerce sites. However, following a severe consumer backlash, the ban was partially revoked in January 2016, with banks enabling consumers to use foreign exchange services, but with limits on transaction values. In January 2016, for instance, GTBank permitted customers to transfer foreign currency via online banking, its mobile app, or at any branch nationwide, subject to a daily limit. Similar restrictions were imposed by other banks, such as First Bank of Nigeria and Sterling Bank. Yet again, with the escalating foreign exchange crisis, in October 2016 GTBank, Standard Chartered Bank Nigeria and Stanbic IBTC Bank suspended use of payment cards abroad and for online transactions.

While banks in Nigeria still focus on traditional bricks-and-mortar branches to deliver services, SunTrust Bank launched a mobile-only bank in 2016, allowing consumers to conduct transactions purely by mobile phone. Another digital bank, Lidya, was introduced in 2016; it offers an online platform for consumers to open bank accounts, access credit and save money. Furthermore, the bank aims to partner with other bricks-and-mortar Nigerian banks to provide an online platform to small and medium-sized businesses (SMEs). The advent of mobile-only banks is likely to accelerate a shift towards electronic payments in Nigeria.

Alternative payments that offer security and convenience are gradually gaining prominence in Nigeria, with banks and payment solution providers launching services. The latest of these is the launch of MasterPass by Mastercard in association with Ecobank in 2016. Similarly, Visa and Nigeria-based technology company JORG Technologies launched mVisa and Nairabox respectively in the same year. Other alternative payments available in the market include PayAttitude by six banks: UBA, Access Bank, FirstBank, Zenith Bank, Skye Bank and Diamond Bank, Verve World and PayPal.

Scope

- This report provides a comprehensive analysis of the Nigerian cards and payments industry.
- It provides current values for the Nigerian cards and payments industry for 2016, and forecast figures to 2020.
- It details the different demographic, economic, infrastructural and business drivers affecting the Nigerian cards and payments industry.
- It outlines the current regulatory framework in the industry.
- It details marketing strategies used by various banks and other institutions.

Reasons to buy

- Make strategic business decisions, using top-level historic and forecast market data, related to the Nigerian cards and payments industry and each market within it.
- Understand the key market trends and growth opportunities in the Nigerian cards and payments industry.
- Assess the competitive dynamics in the Nigerian cards and payments industry.
- Gain insights into marketing strategies used for various card types in Nigeria.
- Gain insights into key regulations governing the Nigerian cards and payments industry.

Table of Contents
EXECUTIVE SUMMARY 2
1.1. Market overview 2
1.2. Key facts 4
1.3. Top five industry events 5
2. PAYMENT INSTRUMENTS 11
2.1. Current payment environment 11
3. E-COMMERCE AND ALTERNATIVE PAYMENTS 13
3.1. E-Commerce market analysis 13
3.2. Alternative payment solutions 15
3.2.1. Paga 15
3.2.2. PocketMoni 15
3.2.3. PayPal 16
3.2.4. Verve World 16
3.2.5. Nairabox 16
3.2.6. Fortumo 16
3.2.7. MasterPass 16
3.2.8. mVisa 17
3.2.9. KongaPay 17
3.2.10. PayAttitude 17
4. REGULATIONS IN THE CARDS AND PAYMENTS INDUSTRY 18
4.1. Regulatory framework 18
4.1.1. Payment System Vision 2020 (PSV2020) 18
4.2. Anti-money laundering and counter-terrorism financing (AML/CTF) 19
4.3. Foreign direct investment (FDI) regulations 20
5. ANALYSIS OF CARDS AND PAYMENTS INDUSTRY DRIVERS 21
6. PAYMENT CARDS 24
7. DEBIT CARDS 27
7.1. Debit cards market analysis 27
7.2. Competition in the debit cards market 29
7.3. Debit cards comparison 31
8. PAY LATER CARDS 32
8.1. Pay later cards market analysis 32
8.2. Competition in the pay later cards market 34
8.3. Pay later cards comparison 36
9. APPENDIX 37
9.1. Abbreviations 37
9.2. Supplementary data 38
9.3. Definitions 45
9.4. Common payment card features 46
9.5. Methodology 47
9.6. Bibliography 49
9.7. Further reading 49

List of Figures
Figure 1: Nigeria, Payment Instrument Shares by Transaction Value (%), 2012 vs 2016 11
Figure 2: Nigeria, Payment Instrument Shares by Transaction Volume (%), 2012 vs 2016 12
Figure 3: Nigeria, E-Commerce Value 13
Figure 4: Nigeria, Population and Economic Indicators 21
Figure 5: Nigeria, ATMs, POS Terminals and Household Consumption 22
Figure 6: Nigeria, Payment Cards Transaction Value and Cards in Circulation, 2012-2021 24
Figure 7: Nigeria, Debit Card Penetration and Turnover Per Card 27
Figure 8: Nigeria, Debit Cards Scheme and Issuer Transaction Value Share, 2016 29
Figure 9: Nigeria, Pay Later Card Penetration and Turnover Per Card 32
Figure 10: Nigeria, Pay Later Cards Scheme and Issuer Transaction Value Share, 2016 34

SECONDARY RESEARCH
Secondary Research Information is collected from a number of publicly available as well as paid databases. Public sources involve publications by different associations and governments, annual reports and statements of companies, white papers and research publications by recognized industry experts and renowned academia etc. Paid data sources include third party authentic industry databases.

PRIMARY RESEARCH
Once data collection is done through secondary research, primary interviews are conducted with different stakeholders across the value chain like manufacturers, distributors, ingredient/input suppliers, end customers and other key opinion leaders of the industry. Primary research is used both to validate the data points obtained from secondary research and to fill in the data gaps after secondary research.

MARKET ENGINEERING
The market engineering phase involves analyzing the data collected, market breakdown and forecasting. Macroeconomic indicators and bottom-up and top-down approaches are used to arrive at a complete set of data points that give way to valuable qualitative and quantitative insights. Each data point is verified by the process of data triangulation to validate the numbers and arrive at close estimates.

EXPERT VALIDATION
The market engineered data is verified and validated by a number of experts, both in-house and external.

REPORT WRITING/ PRESENTATION
After the data is curated by the mentioned highly sophisticated process, the analysts begin to write the report. Garnering insights from data and forecasts, insights are drawn to visualize the entire ecosystem in a single report.

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