The Central Bank of Nigeria reported that over 12 million contactless cashless cards were in circulation as of 2025, as the push for tap-to-pay technology intensifies across the financial system. The CBN has backed this trend through its recently launched Payments System Vision 2028, which envisages wider deployment of contactless technologies. In October, Interswitch and its banking partners deepened the drive toward contactless payment adoption by expanding the supporting infrastructure needed to process these transactions.
Contactless payment represents a significant advance in Nigeria's digital payment landscape, which continues to be hampered by network issues, fraud risks and erratic power supply. The technology allows users to make purchases by holding a contactless card, phone or wearable device near a merchant's terminal, with payment details transmitted wirelessly using radio waves through NFC technology. This eliminates the friction associated with conventional bank transfers and is expected to broaden use of contactless transactions in transportation and everyday shopping.
However, financial experts warn that the convenience and speed of contactless payments carry a significant risk: they may encourage impulse spending by reducing the psychological friction consumers experience when paying. Research by economists Marie-Claire Broekhoff and Carin van der Cruijsen, published in the Journal of Economic Behavior & Organisation, examined Dutch consumer data and found that electronic payments, particularly contactless payments, were associated with less perceived pain of paying than cash. The same study found that consumers viewed cash as more helpful in preventing overspending, while contactless payments were considered the least helpful.
A 2018 UK survey commissioned by GoCompare reinforced these concerns, finding that 17 per cent of contactless payment users admitted to losing track of their spending, while 13 per cent worried that the method encouraged them to spend more than they should. Financial analyst Dr. Titi Fowokan noted that impulse spending through contactless payments is particularly problematic for those who live flamboyantly and lack lifestyle control. She stated: "Their spending pattern may increase due to a lack of self-control. With the state of the economy, everyone needs to adjust his or her lifestyle, and this requires self-determination."
The CBN has implemented daily transaction limits as a protective measure: N15,000 per transaction and N50,000 cumulatively. These safeguards protect users from fraud but may also serve as a buffer against impulse spending. Experts advise consumers to guard against overspending by constantly checking account balances, setting weekly spending limits and living within their means, despite the ease the new payment technology provides.