- The digital transformation market size in Nigeria is estimated at $9.61 billion in 2024 and expected to reach $22.82 billion by 2029, and the AI market is also estimated at $1.05 billion in 2024 and projected to reach $4.64 billion in 2030
- The Finance and telecommunication sectors were the first to adopt technologies in Nigeria. These industries first recognized the potential of digital transformation and have been at the forefront of integrating advanced technologies to enhance their service and customer engagement.
- About 32% of financial service providers have integrated AI technologies and algorithms in their operations.
- Nigeria has a 49.7% score in the World Bank’s Enabling Business of Agriculture score and an ICT Index score of 4.5 out of 9.
- In 2023, Russelsmith became the first 3D industrial manufacturing corporation to manufacture anti-corrosion components for the Nigerian Upstream Petroleum Regulatory Commission (NUPRC)
- Accounting for about 29% of internet usage in Africa, Nigeria is the largest ICT market in Africa.
- The ICT sector’s contribution to Nigeria’s GDP increased from 8.1% to 10.3% between 2020 and 2022, rising by 27% to $55.4 billion.
As nations worldwide gear up for the Fourth Industrial Revolution (4IR), characterized by rapid advancements in Artificial Intelligence (AI), the Internet of Things (IoT), Big Data, and ultra-fast internet speeds like 5G and 6G, Nigeria is making significant strides in digital transformation. Far from being a mere catch-up player in Africa, Nigeria is leading the continent in digital adoption, leveraging public and private sector initiatives to drive a more technologically advanced economy.
A recent research released by Rome Business School Nigeria provides an in-depth analysis of Nigeria’s digitalization state. The report examined the state of digitalization and Artificial Intelligence (AI) adoption in Nigeria, focusing on how digital technologies are transforming key industries. It notes that although Nigeria is at the early stage of digitalization and Artificial Intelligence (AI) adoption, it is one of Africa’s largest economies experiencing significant digital advancement, supported by local and international stakeholders.
The research highlights improvements in digital infrastructure and access, including the increase in fixed broadband subscribers from 5% to 19% between 2008 and 2021, and an increase in broadband penetration to 43.08%. Internet usage also grew significantly, from 0.1% in 2000 to over 150 million users in 2024, representing 70% of the population.
The research further identifies the key drivers of digital adoption in Nigeria, emphasizing the role of global competition and the tech-savvy younger population. It examines the success of Nigerian businesses leveraging digital tools (AI, IoT, and cloud technology) to optimize business processes and improve efficiency, service delivery, customer engagement, and productivity. Additionally, it highlights the growing contribution of digitalization to Nigeria’s GDP, which rose from 12.46% in Q2 2015 to 17.83% in Q2 2020, surpassing the oil sector’s contribution. Projections indicate this figure could triple by the 2030s.
According to the World Bank, Nigeria is only utilizing a fraction of its digital economic potential. The country’s digital transformation began with investments in broadband infrastructure, which remains the cornerstone of a thriving digital economy. However, broadband penetration is still below the African regional average, with internet access largely dependent on mobile networks rather than fixed broadband services.
To bridge this gap, the Nigerian Communications Commission (NCC) has prioritized investments in digital infrastructure, particularly broadband expansion. These efforts aim to improve digital accessibility, especially in rural and underserved communities. Recent data shows a rise in fixed broadband penetration from 5% to 19% between 2008 and 2021, with overall broadband penetration reaching 43.08% by 2022. During this period, Nigeria’s ICT sector grew significantly, contributing over 10% to GDP and reaching a valuation of $55.4 billion.
The Future of Businesses and Digitalisation in Nigeria
The finance and telecommunications industries have been at the forefront of Nigeria’s digital transformation. Banks have embraced AI-driven solutions for credit scoring, fraud detection, and personalized customer interactions through chatbots and robo-advisors. Fintech companies such as Paystack and Flutterwave have further revolutionized digital payments and financial inclusion.
The telecommunications sector has also expanded broadband connectivity, laying the foundation for digital innovation across industries. This has facilitated the growth of e-commerce, online marketing, and entrepreneurial opportunities.
In the agricultural sector, digitalization is gradually transforming farming practices. Mobile applications and web-based tools now provide farmers with real-time data to improve productivity, reduce middlemen’s influence, and expand market access. Stakeholders in the sector are increasingly recognizing the need for digital adoption to enhance Nigeria’s food security and economic stability.
Despite the progress made, Nigeria’s digitalization efforts face significant hurdles. Resistance to change in traditional industries, inconsistent policies and regulatory uncertainties, a shortage of skilled digital talent, insufficient investment in critical infrastructure, and ethical concerns related to data security, privacy, and AI bias remain key challenges.
The report concludes by urging businesses, investors, and policymakers to address these gaps while capitalizing on emerging opportunities. A strategic approach to digital transformation, coupled with increased investment and regulatory clarity, will position Nigeria as a dominant player in the Fourth Industrial Revolution.
As Nigeria continues its journey toward a fully digitalized economy, institutions like Rome Business School Nigeria play a pivotal role in fostering knowledge and capacity building. The future of digital transformation in Nigeria remains promising, with vast potential for economic growth, job creation, and global competitiveness.
Industries and Opportunities for Investment
| Industry | Investment Focus |
|---|---|
| Tier 1: High adoption and current investment priority | |
| Finance/Banking (Blockchain, AI in credit scoring and personalised banking) |
Cybersecurity; Next-Gen banking; banking 4.0 |
| Telecommunications (5G, wide-coverage broadband connectivity) |
Expansion of broadband; 6G, edge computing |
| Tier 2: Moderate adoption and significant weighting | |
| Healthcare (Telemedicine, AI-powered service delivery) |
Sensors; wearables; robotics; VR/AR; 3D printing |
| Agriculture (Moderate precision agriculture technologies) |
Digital marketplace; precision agriculture solutions; farmer training |
| Tier 3: Emerging adoption requiring strategic investment | |
| Oil and Gas (IoT for spill detection, pipeline monitoring, and safety) |
AI and machine learning; talent development; edge computing; quantum computing; AR/VR; drones; blockchain |
| Manufacturing (Early-stage AI) |
3D printing/additive manufacturing; Digital Twin; robotics; drones; predictive maintenance solutions |
| Education (Early-stage e-learning) |
Learning Management Systems (LMS); ICT tools |
| Construction (Early-stage drones, IoT, BIM) |
Digital Twin; 3D printing/additive manufacturing; robotics; drones; predictive maintenance technologies |
Speaking on the report’s significance, Antonio Ragusa, the Founder and Dean of Rome Business School, emphasized that digitalization is the backbone of the Fourth Industrial Revolution (4IR). He described the 4IR as being driven by digital transformation, which has become a fundamental element of industry-wide strategies and operations globally. He stressed that digitalization is a proven catalyst for economic growth, with digitally transformed firms significantly contributing to global GDP.
Prof. Ragusa noted that AI and digital technologies are still in the early stages of adoption in Nigeria, but their impact is already evident across various industries. He highlighted that this digital transformation is propelled not only by global competition but also by Nigeria’s youthful, tech-savvy population. Government and private sector stakeholders have played crucial roles in supporting this shift, with policies such as the National Digital Economy Policy and Strategy fostering a sustainable digital economy. The report also showcases various government initiatives, including skill development programs and digital trade protocols, which have laid the groundwork for a thriving digital ecosystem.
The General Manager, Olakunle Asunmo further outlined the benefits of digital transformation, which include improved efficiency, cost savings, enhanced customer experience, increased competitiveness, and job creation. However, he also pointed out challenges hindering widespread adoption, such as policy inconsistencies, skills gaps, resistance to change, and underinvestment in digital infrastructure. The report categorizes industries based on their levels of digital adoption and provides a roadmap for future investments. While finance and telecommunications lead the way in digital integration, other sectors, such as agriculture, are still lagging despite their potential for growth through technology.
The Head of Academics, Rome Business School Nigeria, Sam Igwe, reinforced the impact of digitalization on major economic sectors. He explained that this report on digitalization and AI adoption will further accelerate the revolutionization of industries such as retail, agriculture, and banking. These technologies are being used to analyze consumer behavior, monitor crop health, provide financial inclusion for underserved communities, and detect financial fraud.
About Rome Business School Nigeria
Rome Business School Nigeria prides itself as one of the leading Business Schools in Nigeria which offers Master’s and MBA programs both on campus and online, as well as Executive Education training programs. Our courses are strategically designed in line with globally accepted standards. The quality of our programs is underpinned by a working atmosphere always connected to the professional world in which the participants share experiences and learn from their classmates.
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