Nigerians Rescued by Opay, PalmPay, Other Fintechs as Traditional Bank Customers Lament Poor Service

• Increased dissatisfaction with traditional banks is fast leading to fintech platforms becoming the preferred choice
• During the busy Yuletide period, many bank clients were annoyed by issues including delayed transactions, high fees, and system disruptions
• Fintech services became more attractive after the Electronic Money Transfer Levy which levies a N50 charge on transactions of N10,000 or more

Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

A major change in Nigeria's financial landscape has been brought to light by the holiday season, with fintech platforms emerging as the go-to options amid growing discontent with traditional banks.

During the busy yuletide period, many bank customers were irritated by issues like slow transactions, exorbitant fees, and system outages.

A disgruntled customer, who chose to remain anonymous, shared their frustration:

“It’s hard to imagine Nigeria becoming a reliable country anytime soon. Every sector is in chaos. I made a simple £600 transfer from my bank account to my UK Revolut account, and six days later, the money hasn’t arrived. Yet, the bank has already deducted over £30 in charges. They prioritize deductions over efficiency and tell stories when you call to rectify issues.”

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Tribune reported that similar sentiments were echoed by diaspora Nigerian Ikhide R. Ikheoa, who commented on X (formerly Twitter):

“No one seems to study how technology is redefining our lives. While visiting Nigeria, I realised I no longer need my Nigerian bank account. Thanks to apps like TransferWise and Remitly, I could transfer money almost instantly from my American account. Why deal with outdated banking systems demanding irrelevant documents like marriage certificates?”

Fintechs offering solutions

Fintech platforms like Opay, Palmpay, and Moniepoint are becoming more popular amidst the confusion because they provide cutting-edge and user-friendly services.

An impressive 84.1 experience score was attained by Opay, for example, which offers real-time alerts on transaction progress and network statuses.

The Electronic Money Transfer Levy (EMTL), which was adopted in December 2024 and demands a N50 tax for transactions totaling N10,000 or more, has boosted the allure of fintech services.

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According to the banking community, Nigerians looking for dependable financial solutions over the holiday season find them to be an appealing choice due to their efficiency and transparency.

Nigeria's use of digital payments has increased dramatically due to a combination of regulatory changes, technology developments, and economic factors. In July 2024, electronic channels processed a record-breaking N89.5 trillion in transactions, an 89 percent increase from the previous year, according to data from the Nigeria Inter-Bank Settlement Systems (NIBSS).

Compared to 2023, online transaction volume and value increased by 60% and 85%, respectively, in the first half of 2024. Over 51 percent of internet payments are now made through bank transfers, with POS devices coming in second at 28.5%. Direct debit systems and ATMs are far behind.

According to stakeholders, Fintech companies have benefited from this trend, as evidenced by Paystack and other platforms that integrate directly with banks to streamline online payments. Tech-savvy Nigerians are drawn to Opay, PalmPay, and Moniepoint because they provide easy small-ticket payment options.

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Similarly, POS transactions have expanded dramatically over the previous five years, growing from N3.21 trillion in 2019 to over N85 trillion in 2024—a phenomenal 2,576 percent growth. With 1.5 million agents nationwide, the agency banking sector has been a major contributor to this growth.

Bank glitches continue

Legit.ng reported that Following financial system disputes, the Central Bank of Nigeria (CBN) ordered a number of commercial banks to return N7.05 billion and $714.569 to bank clients within eight months.

According to reports, the eight-month recovery is a portion of the one billion naira that the banks unlawfully kept under contentious circumstances.

According to research, a large number of Nigerian consumers have accused commercial banks of embezzling their money through unauthorized or fraudulent deductions.

Source: Legit.ng