The e-commerce sector in Nigeria showcases a vibrant mix of payment modalities in 2023. Amid the digital wave, card payments and cash transactions hold firm ground. Simultaneously, modern payment channels like bank transfers, Buy Now Pay Later (BNPL), and digital wallets weave into Nigeria’s e-commerce fabric. Each contributes to the evolving consumer purchasing behavior. This article delves into the multifaceted payment ecosystem within Nigeria’s e-commerce sector, shedding light on diverse payment methods’ roles and impacts. It also highlights the local actors propelling these payment modalities forward, painting a comprehensive picture of the e-commerce payment landscape in 2023.


Payment by card in Nigeria

In 2023, card payments hold a pivotal role in Nigeria’s e-commerce sector. Particularly, consumers highly favor debit cards for online transactions​1​. In 2022, they made up 37% of online transactions, showcasing their continued significance​2​.

To support this payment method, the Central Bank of Nigeria (CBN) is launching a Domestic Card Scheme on January 16, 2023​3​. This initiative, in partnership with the Nigeria Inter-Bank Settlement Systems (NIBSS) and the Bankers Committee, aims to enhance financial inclusion.

Moreover, Verve International, a domestic entity, has already issued over 50 million payment cards by July 12, 2023​4​. This issuance underscores a substantial local scheme presence in the market.

Together, these initiatives by the government and local players foster a conducive environment for card payments in e-commerce.

Local actors: AfriGOpay, Verve

  Verve logo


Payment by cash payments

In 2023, cash continues to be a vital player in Nigeria’s e-commerce payment scene, despite the digital payment growth. The prevalence of cash transactions reveals a lingering trust in tangible payment methods, with about 20% of online transactions conducted in cash in 2022​1​. The trust in online payment platforms is gradually growing in Nigeria, carving a path for more digital transactions as we step into 2023​2​.

However, a clear urban-rural divide paints a different picture. Cashless transactions mostly cluster within urban centers like Lagos, Port Harcourt, and Abuja, while cash remains king in other regions​3​. Economic factors play their part too. A notable rise in the circulation of physical currency in previous years showcases a sustained preference for cash transactions among a significant segment of the population​4​.


Payment by bank transfer

In 2023, bank transfers play a crucial role in Nigeria’s e-commerce sector. This trend echoes the past, specifically 2022, when 29% of online transactions were conducted via bank transfers​1​. This uptake is partly due to a surge in e-payment transactions. The Nigeria Inter-Bank Settlement System (NIBSS) reveals a 42% increase in transactions on its Instant Payment (NIP) platform in 2022​2​. The total value soared to N387 trillion, up from N272 trillion in 2021.

Moreover, the volume of transactions on the platform skyrocketed by 613.1% to 5.2 billion in 2022 from 729.2 million in 2018​3​. This steep rise showcases a strong tilt towards digital banking and instant payments. Retailers too are adapting to this shift. Digital solutions like Fincra are leading the charge. Fincra facilitates online customer payments through bank transfers​4​. It embeds a bank transfer method in its Checkout system. For offline payments, it deploys Point of Sale (POS) terminals with a ‘pay with transfer’ method. This setup eradicates long wait times and instantly confirms transactions.

Local actors: NIBSS, Paga, Flutterwave, Ecobank, Access, FCMB, GTBank, Firstbank

NIBSS logo  Paga logo  Flutterwave logo  Ecobank Logo  Access Logo  FCMB Logo  FirstBank Logo


Payment by installment and BNPL

In 2023, Nigeria’s e-commerce sector embraces the “Buy Now Pay Later” (BNPL) trend. This method lets consumers defer payments for purchases. They receive the item first, then pay in installments. This approach provides credit at the point of sale, growing in popularity in Nigeria​1​.

The adoption of BNPL is on an upward trajectory. A report foresees a Compound Annual Growth Rate (CAGR) of 33.0% from 2022 to 2028. This data underscores the rising acceptance of BNPL in Nigeria​2​. Another report, “Nigeria Buy Now Pay Later Business and Investment Opportunities Databook”, echoes this positive outlook for 2023​3​.

Payless, formerly Guddies Planet, is a key player in Nigeria’s buy now, pay later scene, enabling credit-based shopping for essentials​1​. Carbon in Nigeria and Klump are also embracing this trend with zero-interest installments and flexible payment plans respectively​2​​3​. Meanwhile, CDcare’s ‘pay small small’ model is easing gadget acquisitions in Nigeria​4​. Beyond, LipaLater in Kenya is simplifying shopping with easy installments​5​, while Jumia Pay streamlines various online transactions across Africa​6​.

Moreover, BNPL is not just a global phenomenon. It’s a local reality in Nigeria. The average monthly living wage in Nigeria stood at 43,200 naira per individual in 2018. With BNPL, consumers can manage finances better while accessing needed products​4​.

Local actors: Payless (formerly Guddies Planet), Carbon, CredPal, Klump, CDcare, LipaLater, Jumia Pay

 ZeroCarbon Logo  CredPal Logo  Klump logo  CDcare Logo  LipaLater logo  JumiaPay logo


Payment by digital wallet and X-Pay

In 2023, e-wallets gain traction in Nigeria’s e-commerce scene. Klasha leads in cross-border payments, connecting businesses globally​1​. KongaPay, created by e-commerce giant Konga, now extends beyond its platform. It offers peer-to-peer transfers and easy bill payments, enriching user experience​2​​3​. Similarly, OPay breaks banking norms. It ensures easy payments and rewarding savings, enhancing financial experiences​4​. ReadyCash follows suit with a secure mobile payment service. It aligns with the Central Bank of Nigeria’s guidelines, ensuring safe transactions​5​. Moreover, the digital payment market in Nigeria thrives, with projections hitting US$16.69 billion in 2023​6​. These e-wallets not only ease e-commerce transactions but also signify the growing digital payment ecosystem in Nigeria.

Local actors: Jumia Pay, KongaPay, Paga, PocketMoni, Klasha, Readycash, Kuda, OPay,, Barter, Chipper

JumiaPay logo   KongaPay logo  Paga logo  PocketMoni logo  Klasha logo  readycash logo  Kuda logo  Opay logo  WalletsAfrica logo  Chipper Logo



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