FThe FUGAZ, which is the first tier of banks operating in Nigeria, it comprises of First Bank, UBA, Access Bank, GT Bank and Zenith Bank, were the banks that made the top positions in the list of Banks doing business in Nigeria with the Highest e-business revenue in the first half of 2020.
Sources of E-business revenue generated by Banks includes but not limited to fees and commissions from online purchases and bills payments.
According to Data obtained from their half of the year 2020 financial records show that a sum of N67.3 billion was generated from electronic business by the tier-1 Banks in Nigeria (FUGAZ), there was a decline of 14.2% compared to N78.4 billion recorded in the corresponding period of 2019.
In addition, in comparing the revenue generated by these Banks in previous years, a research data obtained from Nairametrics (an online news media) shows that the Tier -1 Banks generate a sum of N32.3 billion e-business earnings in the second half of 2017, N45.1 billion (2018), and N78.4 billion (2019) respectively before the downward slop in H1 2020.
The cause of this drop in the revenue generated these Banks was not revealed, however, Naijtech states some of the factors that could be attributed to the cause of the decline in their revenue below;
Fifth Position – GT Bank
GT Bank, the most capitalised bank in the stock market and one of top Banks in Nigeria with the highest revenue generated from e-business. The first half of the year 2020 records shows the Bank experienced a decline of 32.2% in it E-business revenue generated. A sum of N 4.8 billion was generated in the H1 2020 compared to N 7.14 billion generated in H1 2019.
The total revenue generated from E-business accounted for 2.1% of it total revenue (225.1 billion) in H1 2020.
Fourth Position — Zenith Bank
In the first half of the year 2020, Zenith Bank generated a sum of N8.94 billion from e-business income as it witnessed a drop of 67.01% from a sum N 27.1 billion revenue generated in the same period in H1 2019. This makes it fourth on the list behind Access Bank.
In addition, the revenue generated from e-business accounted for 2.6% of it total revenue generated during the period.
However, the Bank posted the highest revenue generated after tax in comparison with other Banks in the same period under review.
Third Position — Access Bank
Access Banks is one of the list of Banks in Nigeria which records the highest e-business revenue in H1 2020. The Bank doubled its e-business revenue from N5.5 billion recorded in H1 2019 to N13.9 billion in 2020.
It should be noted that, the Bank recorded the Bank recorded the highest year-on-year growth in e-business revenue as its N13.91 billion was 151.3% higher than the corresponding 2019 earnings.
Second Position — UBA
The multinational Bank moves to the second place. UBA records a total of e-business revenue of N17.93 billion. The multinational grew its E-business income from N16.86 billion generated in the first half of 2019, this account for a 6.35% growth within this period. E-business revenue accounted for 6% of the total income generated during the H1 2020 (N300.6 billion).
Furthermore, Aside from the Bank’s Mobile Banking App, UBA offers different electronic products to its customers for ease of mobile banking transactions. One of them is the U-Pay that gives room for their customers to make payments in countries in Africa where the Bank has its presence just at the click of a button. U-Collect, is another payment platform offered by UBA. it is a consolidated internet payment which allows multiple payment solutions available in Nigeria such as Verve, Master card, Visa and e-tranzact.
First Position — First Bank
One of the oldest bank in Nigeria, First Bank, has been in the front line of instigating revolution in mobile banking in the country. The bank was one of the pioneers of the USSD platform which allows customer to transfer money, purchase airtime via a text messaging application of a mobile phone from the comfort of their homes or any where they are in the world.
Zenith Bank was toppled by First Bank to the first position amidst the Banks with the highest revenue from e-business with a sum N21.7 billion earned in the first half 2020.
Although, the Bank recorded a decline of 0.53% of income generated juxtaposed with N21.83 billion recorded in the H1 of 2019.
It should be noted that First Bank has consistently recorded growth in the previous years, with 40.8% growth between 2018 and 2017 , and a 46.3% growth between 2019 and 2018.
In addition, First Bank has two mobile banking Apps, FirstMobile and FirstMonie, the former functions like other mobile banking Apps while the latter allows customers or users to transfer money and make transaction without having a First Bank account. It allow makes use of FirstBank mVisa, which allows users to make payments for goods and services through FirstMobile by scanning a QR code or by dialing a USSD number. Other apps include; First Bank PayPal and Qr Merchant.
Factors that may have Caused the Decline in Banks E-business Revenue
The decline in the e-business revenue of Bank could be attributed to the economic downturn orchestrated by the upheaval of the pandemic, which accounted for myriad negative disruption in the world economy. The Covid-19 pandemic could be one the factors that caused this downward slop of e-business revenue generated by Banks.
Also, the other factor is the increased number of competition from Fintech start-ups who are trying hard to break into the mobile banking business and gain from its market shares. This could be the cause of the drop in the e-business revenue for Banks in the first half of the year.
Lastly, the Central Bank of Nigeria policy on the downward review of bank charges for different transactions could be another factor.