Top 5 Challenges of the Nigerian Tech Space and Possible Solutions.
Nigeria may be able to boast of having the most number of tech startups in Africa, but lags in a number of other significant areas. The Nigerian tech space is vibrant no doubt, but this is not a metric for bliss as a tech entrepreneur. The tech firms in the country are quite small, and still undergoing a lot of grooming. You could find a tech firm in Nigeria with just about five or ten employees that provide services ranging from e-Commerce, retail, to e-Health services. The tech space in Nigeria is faced by major hurdles, this article explains the top five and provides possible solutions to these challenges.
The challenging environment
The tech space in Nigeria contends with the frustrating process of conducting business especially the stifling policies from the government, and a number of other challenges. While Lagos is significant among other states in the country for its tech startup environment, it appears disconnected from its surroundings and the other parts of the country generally that still lags in infrastructure, faces political instability, and security challenges. A number of promising tech startups in Nigera with the potential to immensely drive profit to the Nation’s economy stopped operation because of the government’s inconsistent approach to policies that relate to tech support. An example is the clamp down on crypto firms by the central bank of Nigeria.
Inadequate electricity is another major problem faced the tech firms in Nigeria. Often times, these firms incur additional costs when they resort to an alternative means of generating electricity for their firms outside the country’s supply. This would mean a shortage in funds that could be invested in the growth of their firms.
Access to funding
Tech firms in Nigeria complain of the difficult process they undergo to obtain loans from banks. It is not news that the banks in Nigeria are always reluctant about loaning to small enterprises for fear of bad loans, this makes it tougher for startup tech firms to convince the banks that they are trustworthy.
Poor internet quality
Despite the fact that Nigeria has the largest number of online users in Africa, the quality of internet services in the country is still poor. The reason for the penetration of internet services across the country is that there is an increase in the number of those who use mobile data over broadband users. While mobile data can work effectively for an individual, it cannot serve large organizations or businesses that require a lot of people being online at the same time.
By January 2021, Nigeria’s population was estimated to be about 209 million people, and in the same year, only about 46 million people have been successfully documented digitally in the country’s database as citizens. The statement to employ the use of the National Identification Number linked with a user’s sim as a means of identification for delivery of service within the country was first issued in 2018. After three years, the approach to utilizing the digital identity strategy for identity management is still a challenge.
The challenges faced by the tech space in the country all lie within the environment, and so, their possible solutions are not far-fetched from the environment.
The government needs to be consistent with regulating policies that would encourage tech firms for a change, and not appear like a killjoy working hard to frustrate the talents that should sprout from the country’s tech space. The operating environment can be friendlier to innovations and creativity with the kind of policies created by the government.
Off-grid energy companies are already working hard to salvage the electricity problem of the country for tech firms, the government also have a role to play in improving electricity supply so that tech firms would save cost for the growth of their business.
A major solution to the finance problem would be creation of more fintech companies that would financially include all tech firms in the country. The banking sector also need to be slack on stringent processes to obtaining loans, the government can step in by incorporating policies that would encourage different payment methods asides cash. The crypto currency innovation is an example.
Almost everyday, new tech driven people invade the tech space with ideas that promises to drive wealth into the nation’s economy with less manual efforts. This global revolution should be encouraged, and this new world should be embraced.