The Nigeria Inter-Bank Settlement System (NIBSS), the country’s largest payment switch, is betting on QR codes as a cash alternative for small-value transactions after improving its Nigeria Quick Response (NQR) payment platform.
At a press conference on Thursday, NIBSS engineers said they have improved the speed of QR code payments by eliminating separate fee queries and enhanced security with stronger authentication measures.
NIBSS has also partnered with the Lagos State government to use QR codes to accept bill payments as a viability test. Premier Oiwoh, NIBSS CEO, told journalists that at least 750,000 bills in Lagos were paid with QR codes in the first week of deployment. The payment switch has also developed a USSD product for feature phones.
QR codes closely replicate cash transactions—they are inexpensive to set up, fast, and allow instant reversals. Users can only make QR code payments by scanning with their bank app, adding an extra layer of security. Global QR code payment transactions are expected to grow by 50% over the next four years, reaching $8 trillion by 2029, according to a study from Juniper Research.
The switch has partnered with banks like Sterling, UBA, and Providus, to increase QR code adoption. First Bank has integrated QR payments into the homepage of the First Mobile App, the bank’s app, a move that has increased QR code transactions, according to a bank representative.
“We saw a spike in usage the moment we placed NQR on the landing page,” a First Bank representative told . “It’s an example of how thoughtful user interface decisions can supercharge adoption.”
Sterling Bank has developed a self-onboarding app for merchants that allows them to accept QR code payments. Merchants can download the app, register, instantly generate QR codes and print stickers, a model similar to Alipay’s early expansion strategy in China, where QR codes spread through small shops and street vendors.
For many merchants, confirming successful transactions is a key issue with digital payments. Fintechs like OPay, PalmPay, and Moniepoint acquired millions of customers during the 2023 cash crunch by providing reliable transaction confirmations, while commercial banks struggled.
To address this problem, Providus Bank has introduced receipt printing for QR transactions, while NIBSS is developing the NQR Soundbox, a device that provides audio notifications for successful payments.
Soundboxes have successfully driven digital adoption among India’s mom-and-pop shops. Paytm, an Indian fintech, generated $150 million in the third quarter of 2023 alone from sound box subscriptions, with 6.8 million devices deployed.
In a demonstration seen by , the NQR soundbox was loud enough to cover a 50-meter distance and could announce transactions in English. The soundbox can also store past transaction logs, allowing merchants to reconcile payments by the close of business.
The success of QR payments will depend on how efficiently merchants can accept payments safer, faster, and more transparently. This could create a network effect that would champion NQR in a way that top-down marketing alone cannot achieve.
