…Lauds Moniepoint On Financial Inclusion Drive
The Federal Government has restated its commitment to supporting the informal sector with enabling policies and other initiatives, describing the informal economy as the hub of the nation’s economic resilience, creativity and entrepreneurial skills.
The Vice President, Sen. Kashim Shettima, made this pledge during the launching of the 2nd ‘Informal Economy Report’ published by Moniepoint at the weekend in Abuja.
Shettima, who was represented at the event by the Minister of Industry, Trade and Investment, Dr. (Mrs.) Jumoke Oduwole, noted that available statistics indicated that over 39 million Micro, Small and Medium Enterprises (MSMEs), accounting for about 96% of all businesses, contributing 50% to GDP, and employing over 84% of the workforce, were currently operating in the country.
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According to the Vice President, in view of the pivotal roles of the MSMEs to Nigeria’s sustainable economic growth, the President Bola Tinubu-led administration places high premium on the informal economy, stressing that “from market traders to artisans, service providers, and young digital entrepreneurs, millions of Nigerians power commerce daily in ways that are unseen yet indispensable to our economy”.
While commending Moniepoint for its sustained contributions to Nigeria’s financial inclusion drive over the past decade by supporting millions of informal businesses across Africa, Shettima noted the 2nd ‘Informal Economy Report’ published by the company gave insight into the challenges and opportunities within the sector and provided a stronger foundation for inclusive, evidence-based policy making.
In his goodwill message, the Minister of Youth Development, Ayodele Olawande, who also lauded the Moniepoint team on the report, noted that the vast potential of the informal sector, powered by the youth, requireed strong synergy among government, private sector, financial institutions and development partners to realise.
He said: “This report could not have come at a better time. It reveals a sector marked by resilience and fragility, powered by the creativity, perseverance, and hard work of millions of Nigerians, most of whom are young people.
“The findings show that while unemployment remains a key driver for participation in informal ventures, these enterprises have become a lifeline for economic survival and a source of dignity and purpose for many. Remarkably, four in ten participants in the informal economy are themselves employers of labour, a clear indication that this sector is not just a refuge, but a crucial engine of job creation”, the minister added.
According to him, while Moniepoint has aptly drawn attention to the vast potential of the informal economy, largely powered by youth, it is clear that realizing this potential requires strong synergy among government, private sector players, financial institutions, and development partners.
Ayodele advocated: “Together, we must move from insight to action, designing and implementing strategies that will enable informal enterprises to access finance, build capacity, embark on steps to formalization and transition to sustainable growth.”
Speaking at the event, the Director-General of SMEDAN, Charles Odii, said small business ownership had grown to 39.6 million nationwide and that businesses earning below N15 million annually had now been exempted from company income tax.
According to him, SMEDAN, in collaboration with the Corporate Affairs Commission (CAC), has commenced free registration for 250,000 informal businesses to encourage formalization and access to government support.
Odii clarified: “We are formalizing small businesses at no cost. The goal is to give them identity, access to finance, and inclusion in the formal economy.”
In his remarks at the forum, the Managing Director of Moniepoint Microfinance Bank, Mr. Babatunde Olofin, described the report as a mirror of Nigeria’s economic reality and expressed optimism that it will guide policymakers and financial stakeholders toward deepening the nation’s financial inclusion at the grassroots.
The report’s findings reflected that women dominated the informal sector and remained the most resilient operators, while youth participation continued to grow rapidly, requiring targeted support.
In addition, the findings also showed that informal business costs had risen by 80% over the past year due to inflation and operational challenges, adding, however, that the sector continues to create more jobs and drive productivity.
A further analysis of the report’s findings indicated that while 65% of businesses recorded revenue growth in the past year, only 47% experienced higher profits due to rising costs of operations, with 38% earning less than N10,000 ($7) daily.
In addition, the report revealed that a digital shift remained underway; though half of customer payments are still cash, transfers are the preferred method for owners paying suppliers (48%).
Even then, this progress is not exciting as 42% of the informal sector operators lacked enough savings to survive even one month without income. Some challenges identified as constraining the informal economy by the report include financing gaps, weak structures, and limited digital literacy hinder growth and longevity.
