The importance of SMEs in the Nigerian economy cannot be overemphasized. According to a Pwc MSMEs survey, Nigeria's MSMEs account for 96% of the total number of businesses in the country and contribute about 50% to the national GDP.
It is no news that the pandemic affected businesses worldwide, especially small and medium scale businesses. The impact of the pandemic on small and large scale businesses in Africa is even worse, and this has affected business confidence. However, the narrative is changing as a recent report suggest that SMEs optimism is on the increase.
According to Mastercard's MEA SME Confidence Index, 81% of SMEs in Nigeria are optimistic about the next 12 months compared to a regional Sub-Saharan average of 74% SME Confidence Index. 78% of SMEs in Nigeria are projecting revenues that will either grow or hold steady.
Mastercard's MEA SME confidence Index also revealed what SMEs in Nigeria perceived as the top three drivers for growth. This include:
- accepting digital payments (75%),
- easier access to credit (72%), and
- doing business internationally and digitizing business operations (72%)
Ebehijie Momoh, Area Business Head, West Africa, Mastercard, said, "Small businesses have faced big challenges over the past year, but one of the most important things they can do for their own growth and in terms of future-proofing their business is to prioritize digital payments acceptance."
"It is extremely encouraging to see that Nigerian businesses are recognizing this and understanding the role that safe, secure and simple digital payments can play as they tackle the year and decade ahead with renewed optimism. At Mastercard, we are committed to keep SMEs connected to the tools they need to create new connections and sustainably grow commerce," he added.
The three drivers of growth identified by SMEs aligns with the findings of Mastercard on the demand side.
According to a recent studies from Mastercard's, over three in four Nigerian consumers (84%) say that they would shop at small businesses if they offered more payment options, and 81% noted being more excited to shop at retailers that can provide the latest payment methods. An equal proportion (81%) said they would be more loyal to retailers who offered multiple payment options.
To get more information on SMEs confidence index, visit. www.newsroom.mastercard.com
Nigeria in focus
GDP: $448.12 billion compared to Brazil's $1.878 trillion in 2019
Population: 200,963,599 compared Brazil's 211,049,519 in 2019
GDP per capita: $2,229 compared to Brazil's $8,717 in 2019
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