Digital payments on the rise in Saudia Arabia and Nigeria

The unstoppable rise of digital payments continues at a pace as Saudi Arabia and Nigeria become the latest countries to record a spike in adoption and a move away from cash, with recent reports showing 67% of Saudi consumers are largely non-cash, while digital payments in Nigeria recorded a 276% increase in transaction volume over the past five years.

Saudi Arabia’s moves to cashless

A new report by leading digital payment provider Visa (NASDAQ: V) highlighted a boom in consumers turning to digital payment in Saudi Arabia.

According to its recently published “Where Cash Hides” report, Visa revealed that 67% of Saudi consumers are now largely non-cash users, making most of their payments with cards or mobile devices. This represents an increase of 4% compared with last year, “highlighting a clear move away from cash,” said Visa.

In the January 21 press release announcing the report, Visa attributed this growing reliance on cash, debit, and credit cards to greater security, convenience, and transparency. The digital payment powerhouse said that, for Saudi consumers, digital payment “Eliminate the risks of carrying physical money, enable seamless online and in-store purchases, and provide instant transaction records for better budgeting.”

This tracks with another of the report’s findings, the decreasing appeal of cash for day-to-day purchases. According to the report, nearly one in four consumers surveyed still use cash for everyday purchases. Still, there is a downward trend across all major categories where cash remains popular, including eating out (-9%) and bills (-8%).

“The data shows a steady move toward digital payments in Saudi Arabia… As more people try mobile and card payments in their daily lives and their expectations evolve, too,” said Ali Bailoun, Visa’s Senior Vice President, Group Country Manager for Saudi Arabia, Bahrain, and Oman. “Consumers want payment options that are quick, convenient, and safe. When digital solutions meet these expectations, they naturally become the preferred choice.”

Visa’s findings are in line with a report published last October by market research firm IMARC, which suggested that Saudi Arabia’s e-commerce industry was poised for rapid growth in the coming years, driven by emerging technologies.

According to IMARC, the Saudi e-commerce sector is predicted to reach a market valuation of $708.7 billion by 2033, tripling its current size. This expected growth translates to a compound annual growth rate (CAGR) of 15% over eight years.

The report attributed this ambitious forecast to a combination of artificial intelligence and digital payments, which are fueling a renaissance in the country’s e-commerce sector. It also cited Saudi Arabia’s high smartphone and internet penetration as a contributing factor, with nearly 99% of the country having internet access and smartphone penetration ranked among the highest in the world.

Yet Saudi Arabia isn’t the only country that is making headlines with its digital payment drive.

Nigeria’s digital payment spike

Speaking at the Committee on Bank Operations Annual Conference last January 23, Cardoso reportedly caveated the substantial growth in digital payments by noting that cash usage has not declined.

For this reason, the CBN Governor highlighted the need for a balanced payment ecosystem in which digital innovation and physical cash coexist rather than compete.

“Nigeria’s payment ecosystem has evolved significantly over the past decade,” said Cardoso. “When properly governed, electronic channels complement cash, reduce pressure on physical currency management, and provide scalable alternatives during peak demand.”

He added that “electronic payments enhance transparency, efficiency, and inclusion,” but, “The objective is balance: “Maintaining confidence in cash while accelerating reliable electronic payment adoption.”

According to the report, Cardoso was keen to frame the strategic challenge for Nigeria not as cash vs digital payments, but as ensuring consumers can always access cash when needed while also building trust in electronic channels for everyday transactions.

This dual approach may be the way forward for many nations in the immediate future; however, in some jurisdictions, digital payments already appear to be on the verge of making cash obsolete.

In November 2025, the Reserve Bank of India (RBI) confirmed a surge in digital payments in the first half of 2025, surpassing the previous year’s metrics, driven by the wholesale adoption of digital financial tools.

According to a report, India’s central bank disclosed that digital payments comprised 99.8% of total transaction volume in the first six months of 2025, while digital payments accounted for 97.7% of total payment value over the same period.

India may be the extreme example, but the latest updates from Saudi Arabia and Nigeria are indicative of a global trend towards digital payments.

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Digital payments reign, but digital wallets in rearview mirror

In 2024, the Bank for International Settlements (BIS) published a report on digital payments that highlighted how they had become “quite popular in advanced economies,” but that their rapid growth in emerging market and developing economies (EMDEs) “is especially noteworthy.”

The BIS research found that between 2014 and 2021, the number of adults in EMDEs using digital payments increased from 35% to 57%.

These findings were supported by a December 2024 report from the European Central Bank (ECB), which found that, in terms of number of payments, cash was used at the point of sale in 52% of transactions in 2024, down from 59% in 2022; meanwhile, in terms of value, cards were the most dominant payment instrument, with a share of 45%, followed by cash at 39%.

This paints a rosy picture for the likes of Visa and Mastercard (NASDAQ: MA), and yet these traditional powerhouses are increasingly peering nervously over their shoulders at the equally exponential rise of digital wallets.

A report published last November by Juniper Research predicted that by the end of the decade, digital wallets will surpass other payment systems, forecasting that the number of global digital wallet users will reach a record high of 6 billion by 2030.

Currently, the figure sits at 4.4 billion, with the prediction representing a compound annual growth rate (CAGR) of 6.39% over five years.

So, while the payment industry leaders may be celebrating their current success, they should be wary of the rising popularity of digital wallets, which could start to take away their customers.

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