UBA Rules Nigeria’s Upbeat Card Market

Nigerian card industry grew in leaps and bounds from 2008 to 2012, according to the latest report by Research and Markets, world's leading source for international market research reports and market data.

According to Research and Markets, the compounded annual growth rate (CAGR), a business and investing specific term for the smoothed annualized gain of an investment over a given time period rose 15.77 per cent to 45 million in 2012 up from 25 million in 2008.

The report also said that UBA Plc led in terms of debit card issuance volume in 2011 and accounted for 27.9 per cent of the total debit card volume.

“Other key operatives in the debit cards category include Guaranty Trust Bank, First Bank, Oceanic Bank and Union Bank, which accounted for respective industry shares of 4.4per cent, 16.9per cent, 6.6 per cent and 8.1per cent.” Research and Markets added.

According to the company which also provides provide the latest data on international and regional markets, over the forecast period, Nigeria’s cards and payments industry is forecast to register a CAGR of 6.00per cent, rising from 48.8 million cards in circulation to 61.6 million cards in 2017.

It said that “In comparison with the same period in 2011, Nigeria's GDP recorded a CAGR of 6.5 per cent in the third-quarter of 2012. The country's annual GDP increased from 6.7per cent in 2011 to 6.9per cent in 2012. Economically, the nation mainly comprises oil and non-oil sectors, which posted decelerated growth rates in third-quarter of 2012.”

According to International Monitor Fund (IMF) forecasts, over 2013-2017, Nigeria's gross domestic product GDP is expected to grow at an average rate of 6.6 percent.

Research and Market, said that “This will maintain consumer prosperity and foster growth opportunities in the cards and payments industry”

The report provides market analysis, information and insights into Nigeria's cards and payments market, including: current and forecast values for each category of Nigeria's cards and payments industry including debit cards, credit cards, prepaid cards and charge cards; as well as comprehensive analysis of the industry's market attractiveness and future growth areas

It also analyzed various market drivers and regulations governing Nigeria's cards and payments industry; and provided detailed analysis of the marketing strategies adopted for selling debit, credit, charge and prepaid cards used by various bankers and other institutions in the market

Some of the key highlights of the report showed that Nigeria's internet penetration levels rose by 19 per cent from 46.2 million internet users in 2011 to 55 million in 2012, equivalent to 33.4 per cent of the total population.

“This is creating a new, high-impact distribution channel for many businesses, especially due to the increasing popularity of social media” the report said.

According to the report, the credit card category recorded a CAGR of 24.77 per cent  during the review period, growing from 300,800 cards in circulation in 2008 to 729,000 cards in 2012.

Over the forecast period, the category is projected to register a CAGR of 5.32%per cent , rising from 807,100 cards in circulation in 2013 to 993,100 cards in 2017.

It also added that in 2010, that the Central Bank of Nigeria (CBN) announced its financial inclusion strategy which includes providing financial services such as loans, savings, money transfers, insurance and pensions in adequate measures to the disadvantaged and low income population, with the aim of reducing the percentage of Nigerians excluded from financial services from 46.3 per cent as of 2010 to 20 per cent by the end of 2020.