Digitalization is crucial for SMEs as it enhances efficiency, reduces operational costs, expands market reach, and fosters innovation. Empowering small businesses with digital tools and financing in Africa can create more jobs, boost GDP, and strengthen the continent’s position in the global digital economy.

The National Information Technology Development Agency (NITDA) announced on February 21 that it has partnered with Flutterwave, Alami, a fintech company that offers sharia-compliant financing solutions for SMEs, and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). The partnership aims to empower MSMEs with digital tools and improved access to financing. The three parties signed a Memorandum of Understanding (MoU) to formalize their collaboration.

The partnership was made during a high-level meeting led by NITDA’s Director General, Kashifu Inuwa, alongside representatives from Flutterwave and Alami, in discussions with SMEDAN’s CEO, Charles Odii. The key focus of the engagement was on leveraging digitalisation to boost the productivity and competitiveness of MSMEs, which are vital to Nigeria’s economic growth.

During the discussions, Inuwa highlighted the impact of digitalisation on MSMEs, stating that digitally empowered businesses can increase productivity by up to 120%, significantly strengthening Nigeria’s economy. He also reaffirmed NITDA’s commitment to championing digital capacity-building initiatives that will enable MSMEs to scale and thrive in the digital economy.

This partnership builds upon an earlier collaboration aimed at transforming the sector. In February 2024, NITDA and SMEDAN launched an initiative to improve digital literacy for over 40 million Small and Medium Enterprises (SMEs) across the country.

According to a newsletter publication by the International Labour Organization (ILO) Country Office in Nigeria, SMEs account for 48% of the national GDP, 96% of all businesses, and 84% of employment in Nigeria. This highlights the crucial role of MSMEs in Nigeria’s economy, reinforcing the importance of the partnership. Empowering MSMEs with digital tools and financial access will have a direct and far-reaching impact on Nigeria’s economic growth.

Hikmatu Bilali