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E-commerce Showing Huge Contribution to Nigeria’s Economic Direction
The e-commerce section of the Nigerian digital economy holds immense potential for the overall growth of the economy. With 58 online marketplaces in the Nigerian e-commerce space, the contribution of companies such as Jumia, Konga, Jiji, in recent years are exceptional and the economic outlook for the next few years of stability and consolidation.
Recently, the federal government revealed the improving impact of e-commerce on the country’s economy, saying the current e-commerce spend in Nigeria has grown to $13billion per annum and is expected to hit $75billion in revenue per annum by 2025.
According to Dr. Evelyn Ngige, Permanent Secretary in the Federal Ministry of Industry, Trade and Investment, e-commerce grew in Nigeria from 14% in 2019 to 17% in 2020. She stated that her ministry was passionate about the growing Investment opportunities in the e-commerce value chain, which are capable of contributing significantly to the country’s Gross Domestic Product (GDP).
Statista’s digital market outlook for Nigeria’s e-commerce also said the number of online shoppers in the country, which was at 76.7 million in 2021, is expected to hit 122.5 million by 2025. A report by Agusto & Co predicted new entrants into the small and medium scale enterprises (SMEs) segment of the Nigerian economy thanks to the emerging e-commerce sales trend.
“Through e-commerce, players enjoy a wider customer reach with the ability to simultaneously connect to millions of consumers locally and globally. We note that the emergence of COVID-19 positively impacted the sector, with players recording a gush of customer orders particularly during the lockdown period. We expect this trend to continue into the emerging post COVID-19 era premised on the rising rate of adoption of online shopping by consumers on the back of the relative convenience it offers,” the report stated.
Commenting on this development, Jumia CEO, Spalazzi said: “It shows that Nigerians are embracing e-commerce more, and the services are becoming part of their daily lives. Importantly, this also shows that consumers are getting value from e-commerce services. This has been our aim at Jumia from the onset, and we are happy that the country is gradually seeing the impact of e-commerce to the economy.”
He added that e-commerce holds a lot of economic potential for Nigeria if given the needed support. “This is just like a tip of the economic benefits the country stands to get from e-commerce. A huge chunk of the market is yet to be exploited. The industry holds a lot of economic potential for Nigeria in terms of employment, technology development and overall GDP of the country,” Spalazzi said.
Figures by the Nigeria Inter-Bank Settlement System (NIBSS), also showed that Nigeria’s e-payment transactions increased by 85.5% year-on-year to N171.99tn in August 2021. Little wonder the Nigerian government is paying more attention to this sector and formulating policies to facilitate a vibrant digital economy.
Abdullahi Kashifu, the Director-General of the National Information Technology Development Agency (NITDA) in his congratulatory message to Jumia on its 9th anniversary said that the federal government is visibly at work to improve digital economy activities in the country, especially seeing as it provided immense support to the government during the covid lockdowns.
He stated that Jumia has had an impressive nine years of e-commerce journey which has seen it expand to several African countries, creating employment opportunities and becoming a good reference for innovative startups on the continent.
He said “These are the kind of startups we encourage, an innovation-driven enterprise. You look at the global market and huge capital investment and job creation. And also you are innovative and creating a lot of jobs in the ecosystem.”
According to the Ministry of Communication and Digital Economy,“Internet penetration in Nigeria in the last one year is unprecedented. Based on available records, the internet came to Nigeria most probably around the year 2000. Up to 2919, the penetration was 33%. Averagely, that’s about 1.7% penetration annually.
But from August 2019 to November 2020, the penetration catapulted to 47%. That is about a 12% increase within one year. It is expected that, by the end of 2021, we could have more that 50% internet penetration in Nigeria and this is encouraging indeed. E-commerce, leverages on internet penetration, without it’s very difficult. So the more broadband penetration, by implication, the more e-commerce activities in the country.”
Going by these indices and other pillars falling into place, e-commerce is set to be a major contributor to the direction of Nigeria’s digital economy as the nation surges towards the projected 2025 growth mark.
News
FBNQuest Asset Management Wins Asset Management Award at BusinessDay Banks & Other Financial Institutions Awards
FBNQuest Asset Management, an investment management firm in Nigeria and a subsidiary of FBN Holdings Plc., is proud to announce that it has been honoured with the prestigious Excellence in Asset Management Award at the recent BusinessDay Banks and Other Financial Institutions Awards.
This recognition highlights FBNQuest Asset Management’s unwavering commitment to delivering exceptional investment solutions and fostering financial growth for its clients.
The award ceremony, celebrated the outstanding achievements of financial institutions across Nigeria, highlighting those that have demonstrated innovation, excellence, and unwavering commitment to quality service.
“We are immensely proud to receive this award, which reflects our dedication to excellence and our focus on creating value for our clients,” stated Ike Onyia, Managing Director, FBNQuest Asset Management. “This achievement is a testament to the hard work and expertise of our team, as well as the trust our clients place in us. We will continue to strive for excellence in all that we do.”
FBNQuest Asset Management offers a range of investment solutions, including mutual funds, discretionary portfolio management, and alternative investments, tailored to meet the diverse needs of its clients.
The firm remains committed to maintaining the highest standards of integrity and professionalism in the asset management industry.
The BusinessDay Banks and Other Financial Institutions Awards are recognized as one of the most prestigious accolades in the financial sector, honouring organisations that excel in performance, innovation, and customer service.
Federal government has unveiled a new policy for Nigerians to deposit dollar bills held outside the formal banking system without scrutiny.
Nigerians have nine-month deadline to do this according to Wale Edun, minister of Finance and coordinating minister of the Economy.
Edun who spoke after the Thursday’s National Economic Council (NEC) meeting in Abuja, said that “there will be no penalty; there will be no taxes, and there will be no questions.”
“There is going to be a release today, details by the federal government through the Ministry of Finance, in conjunction with the Central Bank, a programme, starting today, 31st of October, and lasting nine months, that will allow people to bring in cash that is outside the banking system.
“So therefore it is unsafe, it is unsecure and it is outside of legal limits. They will allowed forbearance to bring dollars cash. Let me emphasize once again, it is to bring dollars that they are holding outside the system to be able to bring them in and credit it to their bank accounts, as long as it is not proceeds of crime, illicit money.
“They just meet the normal ‘Know Your Customer’ criteria of banks and they have an opportunity to bring in those funds, make them safe, make them secure, and make them available through normal, economic activity.”
The minister also stated that 25 million Nigerians have benefitted from federal social protection initiatives, including digital outreach, microenterprise loans, and sector-specific support for power, agriculture, manufacturing, health, and compressed natural gas initiatives.
The National Insurance Commission, (NAICOM), on Wednesday, sacked the board of African Alliance Insurance Plc with effect from October 30, 2024.
The Commissioner for Insurance, Mr. Segun Omosehin, disclosed this during a press conference in its Lagos office, that an interim board and management have be appointed.
The new interim board are: Dr Haruna Mustafar, a former director at Central Bank of Nigeria; Anthony Achebe – Non-Executive and Haj. Halimatu M. Khabeeb – Non-Executive Director.
The management team is led by former Managing Director of International Energy Insurance and Cornerstone Insurance Plc, Jacob Erabor, as Managing Director/ CEO; Wasiu Amao – Executive Director, Technical and Ms. Oremeyi Longe – Executive Director, Finance.
He noted that the interim management has up to one year to turn around the company.
He said the decision follows an extensive monitoring and review of the company’s financial condition, governance, and operational practices, which revealed significant concerns regarding its ability to continue operating in a safe and sound manner which has for some time now generated a lot of uncertainty over claims settlement and payment to annuitants under the company.
The Interim Management Board, according to him will oversee the company’s operations, ensure compliance with regulatory requirements, and implement necessary reforms.
While noting that the Commission will work closely with all stakeholders, including annuitants, policyholders, employees, and investors, to minimise disruption and ensure continuity.
”The objective of this takeover is to protect the interests of African Alliance Insurance Plc’s annuitants, policyholders, other stakeholders, and the broader insurance industry while ensuring the company’s return to stability and compliance.
“The Commission is committed to maintaining the stability and integrity of the Nigerian insurance industry. Our actions today demonstrate our resolve to address concerns and protect the annuitants, policyholders and public interest.”
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