In markets from Lagos Island to Kano, the rhythm of commerce has always been loud and animated. In recent years, it has begun to sound different. A pepper seller in Balogun market now accepts payment via a QR code on her stall. A university student living in Enugu invests his scholarship allowance through a
trading app on his smartphone. The pace of daily life is being subtly rewired by financial technology, and it is not just an urban trend. Mobile money, digital wallets and buy-now-pay-later schemes have reached villages where bank branches are few. As Nigerians adapt to cashless payments, the country’s economy is quietly being reorganised around silicon chips and fibre-optic cables, promising new opportunities and challenges.
After decades of dependence on oil revenues, Nigeria’s government is pushing a bold digital agenda to diversify the economy. In its Digital Economy Policy and Strategy 2020‑2030, the administration emphasised that connectivity and technology skills could become engines for growth. That strategy has started to bear fruit. The International Trade Administration reports that the information and communications technology (ICT) sector contributed about
20 per cent growth to Nigeria’s real Gross Domestic Product (GDP) in the second quarter of 2024. By Q2 2025 the digital economy—covering telecommunications and financial services—contributed
₦6.37 trillion, or
14.4 per cent of GDP, according to the National Bureau of Statistics. In a country with more than 157
million mobile subscribers and
163 million internet users, the foundation for a high-tech transformation is solid. As the population continues to grow – Nigeria is projected to become the world’s fourth-most populous nation in coming decades – the stakes are high. Diversifying away from oil is no longer aspirational; it is existential.
Surging digital payments and the cashless push
A significant marker of this transformation is the explosion in electronic payments. The Nigeria Inter-Bank Settlement System (NIBSS), which runs the backbone of the country’s real-time payments, reported that instant payment transactions reached
₦1.07 quadrillion in 2024, a 78 per cent increase from 2023. Point-of-sale (PoS) terminals processed ₦18.32 trillion worth of transactions that year, while mobile money transactions grew by 28 per cent. These figures may sound abstract until you visit a roadside shop where a PoS agent offers withdrawals, deposits and transfers for a small fee. The growth is being propelled by a combination of necessity and convenience: currency redesign issues and cash shortages in early 2024 nudged people toward electronic transfers, and fintech companies seized the moment by rolling out user-friendly platforms.
Central bank policy has amplified the shift. The Central Bank of Nigeria (CBN) has championed a cashless policy since 2012, limiting large cash withdrawals and pushing digital transactions. Olayemi Cardoso, the CBN governor, has argued that Nigeria is ahead of many advanced economies in payment innovation. In a June 2025 address to bankers in Lagos, he said financial inclusion policies were “boosting digital payment delivery and bringing banking services closer to the people,” while cautioning fintechs and banks to strengthen know-your-customer checks to prevent fraud. Cardoso acknowledged the sector’s successes but emphasised that
transaction monitoring and consumer protection must be prioritised for the most vulnerable.
The regulator’s actions are not altruistic alone; they are also practical. A vibrant digital payments system reduces the cost of printing and transporting currency, widens the tax net by improving transaction traceability and makes it harder for proceeds of corruption to be hidden. For businesses, digital payments have shortened settlement times and improved record-keeping. For consumers, there is increased convenience but also new risks such as phishing scams and fraudulent loan apps. The challenge for regulators is to strike a balance between fostering innovation and protecting users.
Buy Now Pay Later and creative credit models
Another fintech innovation making waves is the buy now, pay later (BNPL) market. Often used for small purchases such as electronics or clothing, BNPL allows consumers to acquire goods immediately and pay in installments over a few weeks or months. Unlike traditional installment loans, BNPL is usually interest-free if repayments are timely. According to a March 2025 report by Research and Markets, Nigeria’s BNPL sector had a value of
$1.42 billion in 2024 and is expected to grow to about
$2.61 billion by 2030. The sector is expanding at a compound annual growth rate of 10 per cent, fuelled by the e-commerce boom, rising smartphone penetration and a youthful population comfortable with digital credit. E-commerce companies and retailers see BNPL as a tool to expand sales, while fintech firms view it as a gateway to longer-term lending.
For ordinary Nigerians, BNPL offers a new financing option that can make previously unaffordable goods accessible. A 2024 graduate working her first job can acquire a laptop needed for remote work; a tailor in Aba can buy a sewing machine and pay back after the busy December period. But analysts warn that consumers may take on more obligations than they can manage. Regulators have signalled plans to issue guidelines covering disclosure, credit-scoring requirements and data sharing between BNPL providers and credit bureaus.
Fintech on the margins: stories from traders and microentrepreneurs
Beyond the macro numbers and corporate announcements are thousands of individual stories. In Makurdi, a young woman named Amina sells second-hand shoes. She first got a smartphone during the pandemic and learned to use a digital wallet to receive payments from customers travelling from nearby villages. Last year she discovered an app offering micro-loans. “They gave me ₦ 20,000 to restock for the Eid rush,” she said, “and I paid back in three weeks with just a small interest. “Another time, a friend recommended a BNPL service that allowed her to buy inventory and pay back after selling, interest-free.” To Amina, the difference is more than convenience; it means she can scale up her small business without collateral.
Similar stories abound. In Nnewi, auto-parts traders use instant payment platforms to pay suppliers in Lagos without carrying bags of cash on the bus. In Kano’s Kantin Kwari market, textile wholesalers accept bank transfers, mobile money and QR code payments. For thousands of informal workers who previously relied on savings clubs (esusu) or local moneylenders, fintech platforms have become an entry point to the formal financial system.
The technology is not a panacea. Many small businesses complain about service interruptions, network downtime and high transaction fees. Others fear digital fraud and prefer cash for large transactions. And while smartphone ownership is growing, there remain millions of Nigerians in rural areas without reliable electricity or connectivity. Analysts estimate that roughly 43.5 per cent of Nigerians had broadband access in March 2024, leaving a significant digital divide. Bridging that gap requires investment in rural fibre networks, affordable handsets and digital literacy programmes.
Investment opportunities and the role of global partners
Fintech’s rapid rise is attracting investors from within and outside Nigeria. Data published by the Ministry of Communications and Digital Economy show that the sector attracted
$191 million in foreign direct investment in Q1 2024, a 900 per cent jump from the same period in 2023. Venture capital funding slowed globally in 2024, yet Nigerian fintech startups raised more than
$331 million, accounting for nearly 30 per cent of all African tech funding. OPay, Moniepoint and Flutterwave have achieved unicorn valuations, while newer entrants are exploring niche markets such as remittance payments and cross-border trade settlement.
International partners are also investing in infrastructure and skills. The European Union’s Global Gateway initiative will invest at least
€ 820 million in Nigeria’s digital transformation, supporting broadband expansion, e-government and digital entrepreneurship. Meanwhile, technology giants such as Microsoft, Google and Cisco have partnered with government agencies to train millions of youths in coding, cybersecurity and digital marketing. Such investments lay the groundwork for a vibrant digital ecosystem, equipping workers and entrepreneurs with the skills needed to build and secure the platforms of the future.
For investors, Nigeria’s fintech story is enticing but complex. The market is large, mobile adoption is high and demographic trends are favourable, yet policy uncertainty and currency volatility remain risks. The Central Bank has occasionally tightened rules on cryptocurrency trading and foreign remittances. For example, in 2021 the CBN banned commercial banks from facilitating cryptocurrency payments, only to later introduce a regulatory sandbox for blockchain projects. In 2023 it issued guidelines for open banking to encourage data sharing while safeguarding privacy. Investors must navigate this evolving terrain and stay attuned to regulatory updates.
A cautious path forward
Not everyone benefits equally from the fintech boom. Critics point to predatory loan apps that shame borrowers who default, high fees charged by some mobile money operators and inadequate consumer protection. Data privacy is another concern. Nigeria’s Data Protection Regulation (NDPR) requires companies to obtain consent and protect personal data, yet enforcement is uneven. The push for data localisation is creating tension between protecting national security and attracting global cloud providers.
There are also systemic challenges. The national power grid remains unreliable, forcing businesses to rely on diesel generators or solar panels. The naira’s volatility complicates cross-border payments and makes pricing difficult for merchants using dollar-pegged platforms. Inflation, which reached 25.8 per cent in August 2025, erodes consumers’ purchasing power and may limit demand for discretionary fintech products. Trust, too, is fragile; widely publicised scams can quickly undermine confidence in digital finance.
Nevertheless, the momentum appears irreversible. Younger Nigerians, who make up a majority of the population, are digital natives. They are more comfortable using apps to save, invest, borrow and pay than queuing at brick-and-mortar banks. Banks themselves are investing heavily in technology, often partnering with fintechs rather than competing with them. A senior executive at one Tier-1 bank said on condition of anonymity that “five years ago we saw fintechs as threats; now we see them as partners because they help us reach customers we never could.”
Fintech innovations are not a silver bullet for Nigeria’s economic challenges, but they are a critical piece of the puzzle. By lowering barriers to entry for entrepreneurs, expanding access to credit, and reducing transaction costs, digital finance can drive productivity and create jobs. The government’s long-term digital strategy and robust telecom penetration provide a solid platform for growth. To sustain the momentum, policymakers must address infrastructure gaps, enforce consumer protection and continue to refine regulations to encourage innovation while safeguarding the system. Businesses should invest in cybersecurity and compliance, investors must prepare for volatility, and ordinary Nigerians will need digital skills to navigate the new landscape.
The promise is evident in the daily transactions of people like Amina and the students trading stocks on their phones. By marrying innovation with inclusion, Nigeria can transform from an oil-dependent economy into a knowledge-driven powerhouse. Achieving that vision will take deliberate policy, responsible private sector action and a population ready to embrace a cashless future. If Nigeria gets it right, the hum of mobile phones and the beep of electronic transfers will be the soundtrack of a more prosperous and equitable nation.
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