Vice President of the Federal Republic of Nigeria, Senator Kashim Shettima, has restated the government’s unvarnished commitment to deepening economic and financial inclusion in line with President Bola Tinubu’s Renewed Hope Agenda, noting that financial inclusion is a core component and the government is making a lot of efforts to ensure that the vulnerable in society have safety nets as exemplified by the ASO accord which was signed this year.
He made these comments over the weekend at the Abuja Continental Hotel in Abuja while speaking as principal guest of honour at the launch of the 2024 Nigeria Informal Economy Report powered by Moniepoint in collaboration with the Small and Medium Enterprise Development Agency of Nigeria, SMEDAN and the Federal Ministry of Industry, Trade, and Investment.
The Nigeria’s Informal Economy Report offers fresh insights for individuals and organizations interested in understanding the dynamics of Nigeria’s informal economy and shaping a more inclusive and sustainable economic landscape. Some of the key insights from the report include:
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The youthful demographic is a critical driving force of Nigeria’s informal economy, with over 57.7% of business owners under 34 years old
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There is an untapped earning potential that is prevalent in the informal segment, with the average monthly income below ₦250,000 while on the higher end of the spectrum, only about 1.3% of businesses in Nigeria’s informal economy earn above N2.5 million monthly
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Retail and General Trade is the leading industry within the informal economy, making up 24% of all informal businesses
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The reality that unemployment is the primary driver for starting a business by many players in the informal sector
Sen Shettima, represented by the Technical Adviser to the President on Economic & Financial Inclusion, Dr. Nurudeen Abubakar Zauro, acknowledged and appreciated the role of players in the informal space, especially Moniepoint. “We can all remember during the Covid-19 lockdown and the recent currency changes, there were a lot of challenges and we saw agencies like this come together and save the country at that point. This is because of the flexible initiatives they brought into the space, especially last-mile delivery by providing a platform that allowed people to successfully transact. SMEDAN’s innovative streak has also been very commendable, he said.
In his opening remarks, Managing Director, Moniepoint Microfinance Bank, Babatunde Olofin, praised operators of informal businesses for the high degree of flexibility and innovation they exhibit in adapting quickly to changing market conditions. Highlighting their economic significance, he said that the informal economy contributes substantially to Nigeria’s GDP and can be effectively mobilized to unleash Nigeria’s full economic potential and provide much needed support to the most vulnerable households in our society.
Minister of Industry, Trade and Investment, Dr. Doris Uzoka-Anite, who formally launched the report, reiterated the Federal Government’s commitment to supporting small business operators in the informal sector of the economy. She pointed out that the informal sector, which often appears to be forgotten, would henceforth begin to enjoy government’s interventions and incentives.
She said: “We are really grateful to Moniepoint for conducting this report. It gives us the basis and foundation now to provide targeted intervention as part of the government’s approach to supporting the informal economy. This segment plays a significant role in the Nigerian economy, we can now bring them up to enjoy incentives that the government is providing to the broader economy as well.
Also delivering a goodwill message, the Chairman, House Committee on Small and Medium Enterprises (SMEs), Hon. Mansur Manu Soro, said the House was taking deliberate steps to prioritize women operating in the informal sector and end gender disparity in earnings. He expressed the National Assembly’s commitment to give the report its full attention, subjecting it to the necessary review and internalizing it while lauding Moniepoint for its positive impact in pushing financial inclusion.
“I want to congratulate Moniepoint for achieving such a national penetration as far as the banking industry is concerned within a very short period of time. The story of Moniepoint is the story of how technology can propel a business to unprecedented levels within a short time span. Reports like this one which we’d be releasing today remain a critical tool used in planning by the government and private sector and we in the House of Reps will be internalizing it legislatively.”
Chief Executive Officer, Moniepoint Inc, Tosin Eniolorunda in his foreword provided the rationale for the report, “In just a few years, over 2 million businesses, many within the informal economy, have chosen Moniepoint as their essential growth partner. The commitment we feel to this sector inspired the creation of this report. By quantifying the informal economy’s impacts and nuances, we can better shape policies and programs to empower and uplift the entrepreneurs driving it forward. Their success is inextricably linked to Nigeria’s continued growth and development.”
In a keynote presentation, Director General/CEO SMEDAN, Charles Odii, said that small businesses are the engine of the Nigerian economy and most of Nigeria’s approximately 40 million small businesses reside in the informal sector. He noted that these businesses which are born of both necessity and entrepreneurial zeal, exemplify the famous Nigerian ‘hustling’ while affirming that the agency is working to formalize these businesses and bring them into the formal sector to increase access to important resources such as finance.
“Ensuring their survival and catalyzing their growth is crucial for poverty elimination, rural industrialization, and the enhancement of livelihoods, all three core mandates of SMEDAN. Their formalization will aid the development of brand value and financial history, which indicates creditworthiness and attracts investment.”
Furthermore, Odii articulated SMEDAN’s agenda aimed at accelerating growth and prosperity for small businesses as encapsulated in the acronym ‘GROW’: Guidance, Resources, Opportunities, and Workforce support. According to him, the agency’s focus spans seven priority sectors including agriculture (EAT Nigeria), manufacturing (PRODUCE Nigeria), tourism (VISIT Nigeria), fashion (WEAR Nigeria), creative industries (WATCH AND LISTEN Nigeria), education (TEACH Nigeria), and services (PATRONISE Nigeria). This agenda focuses on expanding local production capacities, improving market access both domestically and internationally, and creating an enabling environment for over 40 million small businesses, collectively providing more than 60 million jobs.
The event featured a panel session which was moderated by Vice President, Corporate Affairs, Moniepoint Inc, Didi Uwemakpan with the theme: Building an inclusive and sustainable informal economy for Nigeria: Hopes and Impediments. The panelists which included Special Adviser to the President on Economic Affairs, Dr. Tope Fasua; Head, Financial Inclusion Delivery Unit, Central Bank of Nigeria, Dr Paul Oluikpe; DG, SMEDAN; Founder, She Forum Africa, Inimfon Etuk and MD, Moniepoint Microfinance Bank were unanimous and strident in the call for continued collaboration and concerted efforts to support and elevate Nigeria’s vibrant informal economy towards sustainable growth and development.
Some of the dignitaries who attended the event include Senior Special Assistant to the President on Entrepreneurship in Innovation & Digital Economy, Engr Jennifer Adighije; National President, Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), Barr. Dele Kelvin Oye; MD/CEO, Abuja Enterprise Agency, Mr. Chudi Ugwuada-Ezirigwe; Registrar General/CEO, Corporate Affairs Commission, Hussaini Ishaq Magaji, SAN, among others.