Nigeria’s banking sector shut down 229 physical branches within one year, as more customers increasingly relied on Point of Sale (POS) terminals for everyday transactions.
This was revealed in the Central Bank of Nigeria’s (CBN) 2024 Financial Sector Statistical Bulletin, which showed that the number of Deposit Money Bank branches declined from 5,373 in 2023 to 5,144 in 2024, despite a sharp rise in electronic payments.
The figures cover branches and cash centres operated by commercial, merchant and non-interest banks across the 36 states and the Federal Capital Territory (FCT).
Although the number of licensed banks increased from 33 to 35 in 2024, the industry’s physical footprint continued to shrink, highlighting the accelerating shift from traditional banking halls to digital and agent-based platforms.
POS terminals, in particular, have emerged as the dominant alternative to in-branch banking. Transaction volumes through POS channels jumped from 9.85 billion in 2023 to 13.08 billion in 2024—an increase of about 3.23 billion transactions or 33 per cent year-on-year.
Even more striking was the growth in transaction value, which more than doubled from N110.35 trillion in 2023 to N223.27 trillion in 2024, representing a 102 per cent increase.
ATM usage also rose, but at a far slower pace. ATM transaction volumes increased marginally from 1.01 billion to 1.02 billion, while transaction value grew by just over three per cent, from N28.21 trillion to N29.12 trillion.
The data confirms that POS terminals now play a far more central role in consumer payments than ATM withdrawals or visits to physical bank branches.
Branch closures were unevenly distributed across the country. Lagos State, Nigeria’s banking hub, still recorded the highest number of branches at 1,521 in 2024, although this was down by 11 from the previous year. Despite the decline, Lagos still had more than five times the number of branches in any other state.
Ebonyi State recorded the steepest drop nationwide, losing 89 branches as its total fell from 120 in 2023 to just 31 in 2024. Oyo State lost 26 branches, Niger lost 32, while Ekiti and Ondo states each shed 18 branches. Anambra and Ogun lost eight branches each, Cross River lost five, and Plateau recorded seven closures.
The Federal Capital Territory was not spared, losing nine branches to end the year with 391, down from 400 in 2023—showing that closures were not limited to rural or semi-urban areas.
However, some states recorded growth. Delta added six branches, Rivers increased from 272 to 280, while Edo, Kaduna and Kano gained eight branches each. Katsina added three, Adamawa and Jigawa added two apiece, and Kogi recorded a net gain of one branch.
Analysts say these gains reflect targeted expansion in areas experiencing population growth or increased commercial activity, even as the national branch count continues to decline.
The shift away from physical banking is occurring alongside broader changes in Nigeria’s financial system, driven by regulation, technology adoption and changing consumer expectations.
According to the 2025 KPMG West Africa Banking Industry Customer Experience Survey, inflationary pressures have made customers more sensitive to charges, service reliability and transaction security. As more Nigerians migrate to digital channels and POS terminals, expectations around speed, transparency and problem resolution have risen sharply.
While trust remains central to confidence in banks, tolerance for failed transactions, delays and complex processes is waning. The survey noted that customer experience among SMEs declined slightly, with fintechs such as OPay and Moniepoint continuing to outperform traditional banks, particularly in speed and ease of use.
Financial analysts link the explosion in POS usage to cash shortages, the expansion of agent banking networks, mobile wallet adoption, and the convenience of accessing financial services closer to homes and markets.
The surge in POS activity occurred despite sharp increases in agent charges late in the year. In December 2024, many POS operators doubled fees, charging as much as N200 per N5,000 withdrawal, as banks struggled with cash availability.
This was despite warnings from the CBN, which later sanctioned nine Deposit Money Banks with fines totalling N1.35 billion for failing to dispense cash through ATMs during the festive period. Each bank was fined N150 million, with the penalties debited directly from their accounts with the apex bank.
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