How Payment Systems Have Evolved In Nigeria

Shopping in Nigeria is significantly shifting from offline, face-to-face interactions towards online, no-physical contact interactions. The recent pandemic has also highlighted the advantages of online shopping, and more people are now shopping online than ever before. As a result..

How Payment Systems Have Evolved In Nigeria
How Payment Systems Have Evolved In Nigeria


Shopping in Nigeria is significantly shifting from offline, face-to-face interactions towards online, no-physical contact interactions. The recent pandemic has also highlighted the advantages of online shopping, and more people are now shopping online than ever before. As a result, the payment systems are also evolving, with a growing demand for more convenient and faster payment options.

But first, let's take a trip down memory lane, looking at the different payment options we've had in the past.

Pre-colonial Era

Trade by Barter

In the early stages of man’s development, before the advent of money, humans acquired the things they wanted by exchanging one good or service for another good or service. This practice dates back tens of thousands of years and is regarded as the oldest form of commerce. However, it soon became clear that this value system was unbalanced, and some parties found it difficult to find others willing to trade with them. This created a need for a currency system that would allow individuals to measure prices on goods, services, and various kinds of assets.

Cowries (cowrie shells)

Cowries are believed to be West Africa’s first official currency. It is believed to be the most widely and longest used currency in history. Different species of cowrie shells were used as currency, and their acceptability varied from one region to another. However, two of these species were the most widespread. They were Cypraea annulus and Cypraea moneta.

Colonial Era

Coins

During the British era in Nigeria, the use of cowries faded as it became clear that they had little global value, and the use of coins began to gain popularity. Metals became popular as a medium of exchange due to their durability, divisibility, and portability.  They were transformed into gold bars and coins in a variety of metals, including gold, silver, and copper. The introduction of bank notes, which were lighter to carry around, quickly put an end to this in the early twentieth century.

Bank Notes

From 1912 to 1959, the West African Currency Board (WACB) issued the first set of banknotes in Nigeria, Ghana, Sierra Leone, and The Gambia. The highest banknote denomination was one pound.

Post-Colonial Era

Naira Notes

The Central Bank of Nigeria (CBN) began issuing Nigerian currency banknotes on July 1, 1959, replacing the WACB's banknotes and coins. It was not until July 1, 1962, that the currency was changed to reflect the country’s republican status. The words "FEDERATION OF NIGERIA" were replaced with "FEDERAL REPUBLIC OF NIGERIA" at the top of the banknotes. Following the misuse of currency banknotes during the civil war, the notes were changed once more in 1968.

Nigerian Naira notes were first issued on January 1, 1973, and have remained in circulation to this day.

The Present Situation

Following the end of the colonial era, the most common way of shopping in Nigeria was to go into a physical store and exchange valuable goods or services for bank notes. Then came the introduction of bank money transfers; people didn't want to walk around with cash on them for security reasons. Today, bank transfers are a very common method of payment in both brick-and-mortar stores and online marketplaces.  Bank transfers also proved to be beneficial when people began to engage in online shopping. It is a great way to make payments without any physical contact.

As online shopping grew in popularity, online shoppers encountered a common problem: having to fill out their payment and shipping information every time they attempted to check out from a website.

Samuel Eze, the Founder & CEO of OurPass, recognized this, and OurPass, Africa's first one-click checkout solution, was born. OurPass’ one-click checkout allows you to save your payment and shipping information in advance, so every time you shop online, you can checkout with OurPass in one click, addressing a major headache a lot of online shoppers share.

The Near Future

As the reach of online shopping expands, smarter, faster, and safer methods of purchasing your favourite products are being introduced. This includes the headless checkout payment solution, which allows you to check out in seconds using payment links encountered on social media, in an email, in an advertisement, or by scanning a QR code anywhere you encounter the barcode.

These standards have now been adopted by OurPass, and can be accessed by downloading the OurPass App for iOS or Android. ​​OurPass' mission is to revolutionise the checkout process. With its one-click and headless checkout solutions, OurPass is making shopping faster, more secure, and easier for shoppers and businesses everywhere.

Get started with OurPass today and join the future of online checkout!

Interested in knowing more about what OurPass does? Click here to learn more.