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Zenith Bank e-transactions Surge 127 percent to N39.38 trillion

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The growing adoption and investment in financial technology meant the value of electronic transactions on Zenith Bank platforms hit N39.38 trillion in the second quarter of 2021.

That is a surge of 127 percent from N17.31 trillion in the second quarter of 2020, as the lender continues to leverage the country’s youthful population, increasing smartphone penetration, and a focus regulatory drive to increase financial inclusion and cashless payment.

A breakdown of the figures shows the value of mobile money transactions surged by 128.95 percent to N17.08 trillion in June 2021 from N7.46 trillion the previous year.

Also, the value of internet banking increased 101.47 percent to N16.40 trillion in the period under review from N8.14 trillion the previous year.

Zenith Bank has continued to introduce digital products into the financial sector and its operations, organising hackathons in order to develop tech solutions to address problems in the industry.

It executed 907 million electronic transactions (by volume) in 2021, which represents a 118 percent surge from 2020’s 416 million.

A breakdown shows that mobile banking spiked by 99.22 percent to 257 million in June 2021 from 129 million the previous year. Unstructured supplementary service data increased by 76.05 percent to 250 million in the period under review from 142 million the previous year.

Point of Sales transactions spiked by 276 percent to 188 million in June 2021 from 50 million the previous year.

The lender saw fee income on electronic products rise by 91 percent to N17.04 billion in the period under review from N8.93 billion the previous year.

Interestingly, Zenith Bank has been investing copiously on the latest technology with a view to ensuring that customers carry out transactions conveniently wherever they are. It ensures financial services reach farmers and the poor in the rural areas.

The pandemic was a boon for the lender because there were accelerations in online transactions since customers were confined to their homes observing sit at home orders of the government.

Zenith Bank, in its financial sustainability report for 2020, said it is going further by leveraging its retail banking drive to reach the unbanked.

“We ensure compliance with relevant regulations and policies aimed at promoting financial inclusion. In line with the cashless policy directive of the apex bank, the Bank has leveraged technological solutions to develop various products to ensure that the policy objectives are achieved,” said the Bank.

“Our e-banking products and channels are critical drivers of our financial inclusion strategy. We create these products and platforms to assist in reducing cost of banking and help to on-board previously unbanked members of the public, enabling them gain access to financial services through mobile devices, especially in areas where physical bank branches may be unavailable,” said the Bank

It has entered a strategic partnership with Facebook and Twitter to launch a Masterpass QR bot for Facebook messenger, that will enable Nigerian businesses to set up digital accounts and accept QR payments.

QR Payments (Quick Response Payments) would allow individuals and small businesses to make and receive payments in real time via Facebook Messenger.

However, the flooding of financial technology (FINTECH) startups or companies is threatening to shrink the financial intermediation role of banks as they are taking advantage of the unbanked population.

Moreover, some customers see Fintech firms giving them the kind of privacy that they need while ensuring the expeditiousness of transactions.

More importantly, telecommunications companies and Fintech are cannibalising sales of banks, a double whammy for industry reeling from a punitive regulatory environment.

According to research house Chapel Hill Denham in their banking sector coverage, MTNN’s fintech revenue will be above the fee & commission income of any Nigerian bank by 2025.

Between 2014 and 2019, Nigeria’s bustling fintech scene raised more than $600 million in funding, attracting 25 percent ($122 million) of the $491.6 million raised by African tech startups in 2019 alone—second only to Kenya, which attracted $149 million, according to research house Mckinsey and Company.

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