Zone, a Nigerian Payment Infrastructure Company, has processed transactions exceeding 1 Billion of ₦ Billions on its blockchain network between November 2022 and December 2024. The company recorded 100 million transactions, with an average value of 10,000 ₦ of 10,000 per transaction. Despite the slow adoption of blockchain technology in the banking sector, an important part of these transactions was carried out through automated cashier machines (automatic counters), marking an important step for payments powered by blockchain in Nigeria.
This achievement arrives at a time when the use of ATM was down. In the past three years, the total value of ATM transactions has dropped from 32.65 sterling books in 2022 to 28.2 billions in 2023, because consumers are increasingly promoting point of sale (POS) and digital payment solutions. Currently, 12 banks use the zone blockchain network, although some have adopted it for ATM transactions.
The leadership of the company indicated that a broader adoption of the ATM could have accelerated the realization of this transaction volume. The ATM served as a test case for the introduction of the system in a controlled manner, ensuring that the blockchain network could effectively manage transactions before rising to the heavier payment volumes.
Expand blockchain requests to point of sale payments
The zone blockchain network offers banks faster settlement times for ATM transactions, but some financial institutions have integrated it into a different purpose. Zonepos, another service of the company, allows the processing of POS payments via blockchain technology.
After obtaining a switching license in 2022, Zone launched a test phase for its blockchain network on automatic ticket distributors in November of the same year. The main challenge during the initial phase was to integrate banks and respond to regulatory concerns concerning compliance. By automating several manual processes generally associated with financial audits, the company was able to demonstrate the reliability of its system. The deployment of the pilot at the end of 2022 opened the way for commercial operations from January 2023, with zone closely collaborating with banks to improve their payment infrastructure.
One of the main concerns for traditional financial institutions was regulatory uncertainty surrounding existing blockchains and decentralized financial solutions (DEFI). Many banks are hesitant to engage with blockchain-based systems due to fears of non-compliance, potential thin or even loss of operating licenses.
Zone claims that its layer 1 blockchain is capable of processing 10,000 transactions per second (TPS), which makes it very effective for financial transactions. The efficiency of the system in the management of ATM transactions, combined with a overvoltage of POS transactions, prompted the company to extend its blockchain network to terminal payments.
Strategic partnerships and regulatory approvals
In June 2024, Zone extended its blockchain network with POS terminals. In August, the company has teamed up in Nigeria Inter-Bank Settlement System PLC (NIBSS), the country’s main change in payment, to facilitate the recording of POS transactions on its big blockchain book. This collaboration allows NIBSS to manage the interactions between the banks of card holders and the POS terminals using the regulated zone blockchain frame.
The partnership was initially to start in October 2024, the NIBSS being fully integrated into the zone blockchain ecosystem. This integration represented a revolutionary movement, marking the first body of a major regulatory organization operating on a large scale in a blockchain frame.
However, the process was faced with delays due to the institutional structure of NIBSS and the uncertainty surrounding the position of the central bank of the Central Bank of Nigeria (CBN) on the initiative. Although Zone concluded an agreement with NIBSS in August 2024, the CBN only granted the final approval in December, extending the implementation calendar.
As a regulated entity, the NIBSS adheres to strict institutional processes, ensuring that all operations align with its project cycle. The area has since added Nibss to a testnet on its blockchain and continues to test the system to verify the integrity of the data while preparing large -scale implementation. Although the network has not yet actively recorded payment transactions, it currently collects and stores the PO terminal identities, Nibss verifying these recordings on the blockchain.
Future expansion and commercial perspectives
Zone takes place with caution with the deployment of its blockchain for point of sale payments, prioritizing regulatory confidence and conformity. The company aims to extend its technology beyond the borders of Nigeria in the coming years, although discussions with foreign financial institutions have not yet taken place.
The startup has refused to disclose its income figures, citing privacy agreements with investors. In the future, Zone plans to extend its blockchain payment rail to companies facilitating transfers of account funds, further incorporating its technology into daily financial transactions for Nigerian consumers.
