The Nigeria Inter-Bank Settlement System Plc (NIBSS) is grappling with rising energy costs as it maintains round-the-clock operations required to keep Nigeria’s electronic payment infrastructure running.
The payment infrastructure company reportedly spends about N150m monthly on electricity and alternative power sources, with diesel accounting for roughly N100 million of the recurring cost.
The expenditure highlights the significant operational burden created by Nigeria’s unreliable power supply for institutions that provide critical digital infrastructure and cannot afford prolonged downtime.
NIBSS operates key payment infrastructure that enables banks, fintechs and other financial institutions to process electronic transactions across the country.
Its systems support inter-bank transfers, instant payments and other digital payment services that have become increasingly central to economic activity.
The company’s reliance on alternative power sources reflects the need to maintain uninterrupted operations even when electricity from the national grid is unavailable or inadequate.
For a payment infrastructure provider, a power interruption can have consequences beyond the immediate loss of electricity, potentially affecting transaction processing, settlement, connectivity and other services that depend on continuous availability.
NIBSS has consequently invested in backup power arrangements as part of efforts to maintain system resilience and minimise service disruptions.
The development comes as Nigeria’s digital payments ecosystem continues to expand, increasing the volume and importance of transactions processed through electronic channels.
NIBSS said in August that its newly introduced National Payment Stack (NPS) had recorded 26.55 million transactions valued at N1.4tn across 48 participating institutions.
The NPS is designed as a new digital payments infrastructure to succeed the legacy NIBSS Instant Payment system and provide a more integrated payments architecture.
The company has described the NPS as a sovereign, ISO 20022-compliant infrastructure intended to connect payments, identity and data on a unified platform, while supporting transaction processing and other financial services.
NIBSS’s growing infrastructure requirements therefore come at a time when the financial system is becoming increasingly dependent on electronic channels for everyday transactions.
The company’s website describes its role as providing infrastructure that supports the banking ecosystem and Nigeria’s payment industry, including the Nigeria Central Switch and NIBSS Instant Payment platform.
NIBSS is also certified under ISO 27001 for information security management, ISO 22301 for business continuity management and ISO 20000 for IT service management, reflecting the importance of resilience and continuity in its operations.
The rising energy burden is not unique to NIBSS. Digital infrastructure operators, financial institutions and telecommunications companies across Nigeria have historically relied on diesel-powered generators and other backup systems because of inadequate and inconsistent grid supply.
Industry analysis has similarly identified electricity reliability as an underlying challenge for Nigeria’s digital payments ecosystem, with payment switches, bank data centres and telecommunications infrastructure requiring continuous power to maintain service availability.
As the country pushes further towards digital payments and greater financial inclusion, the cost of keeping critical infrastructure operational has consequently become an important component of the broader cost of running the financial system.
NIBSS has continued to invest in payment infrastructure as transaction volumes grow. In June, its Managing Director and Chief Executive Officer, Premier Oiwoh, said the company monitors transaction velocity to anticipate potential system failures and distributes transaction loads across multiple environments to support uninterrupted services.
The company’s latest National Payment Stack initiative is also expected to modernise the underlying infrastructure supporting Nigeria’s digital payments ecosystem, with NIBSS positioning the platform as a foundation for a more interconnected and resilient financial system.
However, maintaining that infrastructure requires significant expenditure on power, technology, security, connectivity and business continuity systems.
For NIBSS, the energy cost underscores a wider challenge facing Nigeria’s digital economy: ensuring that the physical infrastructure supporting increasingly digital financial services is reliable enough to match the rapid growth in electronic transactions.
