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.