Nigerians love the internet. The country is estimated to have more than 148 million mobile telephone subscribers and at least 92 million of them access internet data services on their devices. And, with around one-third of Nigeria’s population now under 24 years old and a growing middle class population, all signs suggest that internet penetration and usage is set to grow significantly.
In particular, social media channels are gaining significant adoption in Nigeria. Platforms such as Facebook, Instagram, Twitter, LinkedIn and Tumblr are widely used by Nigerians as a way to communicate with friends and the wider public. In fact, according to our survey, 77 percent of Nigeria’s banking customers now use social media for personal purposes.
The problem is that Nigeria’s banks have largely failed to translate this passion for the internet and social media into increased adoption of internet and mobile banking solutions. Just 42 percent of Nigerian banking customers said they use online banking platforms for one or more banking activities. And just 40 percent said they have interacted with their bank using social media in the past.
The benefits of shifting transactions to web-based platforms are clear. For customers, web-based platforms offer convenience, 24 / 7 access, and freedom of location. For Nigeria’s banks, the shift promises the opportunity to improve service delivery and achieve a lower cost-to-serve.
So why are Nigeria’s banks struggling to move customers to internet and mobile banking platforms? Nigeria’s banks have certainly put significant investment and effort into developing a better and easier online banking system. And Nigeria’s customers have certainly proven themselves to be internetsavvy.
Part of the problem relates to conversion. More than two-thirds of Nigerian banking customers say they have never tried their bank’s online platform. So while Nigerian banking halls are often filled with customers happily using their phones to text, chat, browse and shop online, just one-in-three of them have ever considered using that same device to avoid the banking hall altogether. Introducing these customers to alternative channels should be a top priority for Nigeria’s banks.