Why Digital Payments Are Still Struggling Among Traders in Northern Nigeria
In northern Nigeria, especially among local traders with limited formal education, mobile money is often met with resistance. Many prefer cash transactions, but as KAMAL IBRAHIM explores, some traders in Bauchi State are slowly changing the landscape by embracing digital payment methods.
Musa Abubakar, a 41-year-old shopkeeper in Misau, Bauchi State, has built a successful business by offering both cash and mobile money payment options. Despite his semi-literate background, Abubakar was quick to see the benefits of accepting mobile money payments. For him, this was a necessary step to stay competitive, expand his business, and meet customer demands. “Mobile payments are the future,” he says, acknowledging how it helps avoid the risk of armed robbery and the hassle of carrying large sums of cash. Over the past five years, the shift to digital payments has helped Abubakar attract more customers and increase his daily profits.
However, Abubakar is one of the few traders in his local market who accepts mobile money. For him, security is the biggest advantage. “It reduced my chances of becoming a victim of armed robbery,” he adds while packing up his goods for the day. Despite occasional glitches, like delayed payments or technical issues, Abubakar remains committed to mobile money as it offers more convenience and security than cash.
But not all traders share Abubakar’s optimism. Muhammad Auwal, a 38-year-old grocery seller in the same market, has had bad experiences with mobile money and prefers cash. “The risks are just too high,” he explains, recalling a situation where a customer claimed to have paid via mobile money but later showed a fake transaction alert. “The customer left with my goods, but I never saw the money,” Auwal says bitterly.
For Auwal, trust is essential in business, and mobile payments have proven unreliable. He also shared a more serious incident from 2019 when he made a N60,000 mobile transfer to a wholesaler in Kano, but the money didn’t reflect in the wholesaler’s account for two weeks. “I had to scramble for cash to get my goods,” he remembers. These kinds of stories are common among traders in northern Nigeria, where cash transactions are considered more dependable.
Musa Sarki, a smartphone dealer in Hadeja, Jigawa State, has taken his aversion to mobile money a step further by refusing to sell to customers who want to pay digitally. “I simply don’t trust it,” Sarki says. Other traders, like Zakar Shu’aibu, who sells vegetable oil, are familiar with digital tools but find mobile payments unreliable due to network issues and frequent transaction failures. “The most frustrating part is when a transaction fails, but the money is still deducted from your account,” he says.
For Hudu Ya’u, a poultry manager in Dass, Bauchi State, the charges associated with mobile money are discouraging. “The fees eat into my profits,” he explains, adding that the high transaction costs make it less attractive than cash, which doesn’t have such fees.
Despite the growing number of traders like Abubakar embracing digital payments, the road to widespread adoption remains bumpy. A major factor is the fear of fraud, delayed transactions, and connectivity issues. “Sometimes I need to go to the bank because of poor network service,” says Hamza Hadeja, who has occasionally opted for mobile payments but struggles with the delays. These issues make cash still the preferred choice for many traders.
The experiences of traders in northern Nigeria highlight the balancing act between opportunity and risk. For some, like Abubakar, the benefits of mobile money outweigh the drawbacks. For others, like Auwal, the risks of fraud and failed transactions are simply too great to overcome.
The Nigerian government and financial institutions have made strides in promoting mobile payments. Since 2007, the Central Bank of Nigeria (CBN) has introduced mobile money services to encourage financial inclusion. The CBN’s regulatory framework and partnerships with telecommunications companies have made mobile money more accessible. However, a 2024 report by Statista shows that mobile money usage among Nigerians fluctuates, with only 8.1% of people aged 16 to 64 using it in 2024, despite the growing transaction value.
The challenge now is addressing the issues that hinder the adoption of mobile money, particularly in northern Nigeria. A professor of Accounting and Finance at Abubakar Tafawa Balewa University, Bala Dalhat, suggests that increasing awareness and tackling cybercrime and fraud are essential steps to improving adoption. “Digital payment is more affordable, and once your money is credited, you know it’s safe,” he says. However, he emphasizes the need for better network connectivity and reliable infrastructure.
The ongoing struggle with digital payment systems in northern Nigeria underscores the need for more education, stronger infrastructure, and more trustworthy services. Until these challenges are addressed, the potential for mobile payments to drive economic growth in the region remains untapped. Trust, security, and reliability are key to bridging the gap between the promise of digital payments and their widespread acceptance.
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