Flutterwave is at the forefront of driving Nigeria’s digital economy revolution amidst disruptive technologies.

The advent of technological advancements, particularly enhanced connectivity capabilities, has been a catalyst for the exponential growth of the digital economy and the expansion of global trade.

In Nigeria, the digital economy has experienced a remarkable surge in revenue, escalating from $5.09 billion in 2019 to $7.13 billion in 2020. This upward trajectory continued in 2021, with revenue reaching an impressive $9.97 billion. According to a report published by the Central Bank of Nigeria and authored by Olugbenga Agboola, the esteemed CEO and founder of Flutterwave, Africa’s leading payment technology company, Nigeria’s digital economy revenue is projected to maintain its growth trajectory, reaching an anticipated $18.30 billion by 2026.

To date, Nigeria has the highest number of startups on the African continent, surpassing South Africa, Egypt, Kenya, and Ghana.

However, to fully capitalize on its digital economy potential, Nigeria must establish essential foundations. The report titled “Nigeria’s Budding Digital Economy: Coping with Disruptive Technology” emphasizes the significance of collaboration between the public and private sectors in achieving this goal.

Crucial Components of Nigeria’s Digital Economy

The fundamental pillars of the digital economy, such as a skilled workforce, infrastructure, platforms, financial services, and entrepreneurship, are essential for its growth and success.

The Nigerian government and the National Information Technology Development Agency are actively pursuing a set of well-defined digital economy development goals, as outlined in Nigeria’s National Digital Economy Policy and Strategy.

These goals encompass initiatives aimed at enhancing digital literacy, fostering e-commerce, and supporting the adoption of technology that facilitates the seamless exchange of digital services and goods.

In the globalized landscape of digital commerce, the emergence of competitors from diverse locations poses significant challenges for businesses. To ensure survival and prosperity, innovation becomes paramount. This underscores the critical need to cultivate a digitally proficient workforce capable of bolstering Nigeria’s contributions to the digital economy.

Formal education plays a crucial role in enhancing the digital literacy of the nation, potentially motivating the public to engage with digital services and products. Additionally, the availability of infrastructure, including fast internet connections and affordable devices for accessing online content, is essential for fostering involvement in the digital marketplace.

As the founder and CEO of Flutterwave, Olugbenga Agboola, astutely observed, Nigeria’s fixed broadband penetration rate stood at a mere 0.04% in 2018. This figure falls significantly below the African average of 0.6% and pales in comparison to the global average of 13.6%.

Nigeria has overcome some of the potential challenges associated with the absence of physical fiber optic cables for internet connectivity.

The widespread adoption of smartphones in the country has facilitated internet access through mobile devices, contributing to an internet penetration rate of 49% in 2021. Projections indicate a rise to 59.9% by 2026, as reported by Agboola.

To ensure successful participation in the digital economy, platforms that enable businesses to promote and offer products and services online are of paramount importance.

These platforms empower small companies to connect with larger audiences, gather feedback, and adapt to market trends at a relatively affordable cost.

Agboola’s report emphasizes the significance of discovering seamless and straightforward methods to integrate entities like restaurants into the digital domain, particularly in Nigeria, where numerous businesses operate outside of the digital sphere.

Furthermore, a digital economy necessitates skilled professionals in the technology sector. The United Nations Conference on Trade and Development, in its 2021 Technology and Innovation Report, advised developing nations to prepare for fulfilling the associated workplace requirements by implementing policies related to science, technology, engineering, mathematics, and innovation.

What Lies Ahead for Nigeria’s Digital Economy

Nigeria has made significant strides in achieving the technological advancements necessary for the expansion of its digital economy, according to Olugbenga Agboola. Further developments in this area are anticipated.

The African Union Commission, in collaboration with the World Bank, the United Nations Economic Commission for Africa, African Union Development Agency – New Partnership for Africa’s Development, Regional Economic Communities, Smart Africa, African Development Bank, African Telecommunications Union, African Capacity Building Foundation, and the International Telecommunication Union, has established a digital transformation strategy for Africa.

The proposed strategy aims to facilitate African nations’ transition towards an inclusive digital economy, thereby enhancing Africa’s overall participation in the global economic landscape.

In addition, the plan incorporates measures to address the challenges posed by inadequate digital infrastructure through the establishment of a dedicated digital sovereignty fund. This fund serves as a financial mechanism to support projects that effectively bridge the digital infrastructure gap, ensuring greater accessibility and affordability of broadband services.

By 2030, it is projected that all Africans will have the potential to access locally produced smart devices priced below $100. Additionally, internet services are expected to provide a minimum speed of 6 megabytes per second at a cost of less than 1 cent per megabyte, as stated by Flutterwave’s Agboola.

Furthermore, supplementary initiatives are being implemented to enhance the digital literacy and online skills of the population, with programs designed to reach hundreds of millions of Africans.