Why banks close 229 branches in Nigeria

Nigeria’s banking sector closed 229 physical branches in the past year as customers increasingly prefer electronic payment channels, especially Point of Sale (POS) terminals, over visiting bank halls, the Central Bank of Nigeria’s (CBN) 2024 financial sector statistical bulletin shows.

According to the report, the total number of Deposit Money Bank branches nationwide dropped from 5,373 in 2023 to 5,144 in 2024, even though the number of licensed banks grew from 33 to 35 during the period.

This decline highlights how banking in Nigeria is rapidly moving away from traditional branch operations toward digital and electronic platforms.

The data revealed a significant rise in POS transactions.

The volume of POS transactions jumped from 9.85 billion in 2023 to 13.08 billion in 2024 — roughly a 33 per cent increase — while the value of these transactions more than doubled from ₦110.35 trillion to ₦223.27 trillion in the same period.

Meanwhile, ATM usage grew only marginally.

Branch closures occurred across many states. Lagos State retained the highest number of branches with 1,521 in 2024, despite losing 11 locations from the previous year.

Ebonyi State recorded the largest reduction in branches, dropping from 120 to 31.

Other states with notable declines included Oyo, Niger, Ekiti, Ondo, Anambra, Ogun, Cross River, Plateau and the Federal Capital Territory.

However, not all regions saw cutbacks. Some states experienced branch growth: Delta added six branches, Rivers added eight, while Edo, Kaduna and Kano recorded gains of eight each.

Katsina, Adamawa, Jigawa and Kogi also saw modest increases.

Analysts say the trend reflects broader changes in how Nigerians access financial services.

With advances in technology and rising adoption of mobile and POS payments, many consumers now complete transactions digitally, reducing foot traffic to physical branches.