Two decades ago, banking in Nigeria was a frustrating experience—long queues, excessive paperwork, and limited financial access kept millions excluded read more The death of cash counters: How digital banking took over Nigeria
The evolution of Nigerian banking over the past two decades has been marked by significant transformation. Initially plagued by inefficiencies and limited access, especially in rural areas, the sector underwent a major shift with the 2006 banking consolidation, which led to mergers and the emergence of stronger institutions like Sterling Bank.
The rise of digital banking in the early 2010s, driven by increased internet and smartphone penetration, revolutionized the industry. Innovations such as USSD banking expanded financial inclusion, allowing even those without smartphones to access services. Sterling Bank exemplified this shift by rebranding as a digital-first bank, investing in fintech solutions and enhancing digital platforms.
Statistical growth underscores this transformation, with mobile transactions surging and digital payments projected to reach $68.34 billion by 2025. However, the sector also addressed its reliance on foreign software, with Sterling Bank leading the charge by adopting indigenous solutions like SeaBaas, developed by Nigerian fintech Peerless.
Looking ahead, the future of Nigerian banking lies in open banking and embedded finance, integrating financial services into everyday platforms. Despite these advancements, traditional banking persists, with the retail segment expected to generate $19.93 billion in net interest income by 2025. Thus, Nigeria's banking sector is poised for continued evolution, balancing digital innovation with traditional services.