Describes how widely e-Commerce is used, the primary sectors that sell through e-commerce, and how much product/service in each sector is sold through e-commerce versus brick-and-mortar retail. Includes what a company needs to know to take advantage of e-commerce in the local market and , reputable, prominent B2B websites
Last Published: 8/13/2019

Overview

Nigeria’s economy is gradually becoming cashless, as digital payment and electronic banking are implemented in phases across most states of the federation, which began in Lagos as a pilot in 2012.  At present, the adoption of electronic transactions are continuously increasing, with ATM transactions dominating the volume of electronic transactions and the Nigerian Inter-Bank Settlement System Instant Payment dominating in value. The cashless policy has resulted in increasing demand for ATM services deployed in major cities and commercial centers across Nigeria, such as Lagos, Port Harcourt, Enugu, Onitsha, Ibadan, Kaduna, Kano, and Calabar, to facilitate electronic banking and financial services.
 

Cross-Border eCommerce/B2B eCommerce/Online Payment

The successful adoption of electronic payments in Nigeria is encouraging the entrance of payment service providers such as Visa and MasterCard, which see Nigeria as a promising market.  Debit cards from many local banks such as Citibank, Zenith, UBA, and Fidelity, are now used by Nigerian travelers to make payment in countries such as the United Kingdom, Germany, South Africa, and the United States.  Online wallet services like PayPal are available to residents of Nigeria and all transactions are currently denominated in the USD.
 

eCommerce Services

The demand for electronic transactions has attracted payment facilitators from Europe and Asia who are investing in Nigerian electronic infrastructure projects.  Online commerce and financial technology in Nigeria is strengthened by fast growing youth populations, expanding consumer power, and increased smartphone penetration.  The current eCommerce spending in Nigeria is estimated at $12 billion, and is projected to reach $75 billion in revenues per annum by 2025 (McKinsey).
 

eCommerce Intellectual Property Rights

In 2015, the Federal Government signed the cybercrime bill into law to prohibit and prevent fraud in electronic commerce.  The purpose of the Cybercrimes Act of 2015 extends beyond prohibiting, preventing and criminalizing online fraud, but also prescribes punishments and sets the institutional framework for enforcement.  The goal is to protect e-business transactions, company copyrights, domain names and other electronic signatures in relation to electronic transactions in Nigeria.
 

Digital Marketing & Popular eCommerce Sites

Africa Internet Group owns online retailer Jumia and 9 other e-ventures.  Its best-known venture is online retailer Jumia, one of Africa’s better funded startups.  Since its inception in Lagos in 2012, Jumia now operates in 14 African countries selling everything from diapers to iPhones and microwaves.  In 2016, the venture funded company reached a billion-dollar valuation, and reported revenues of $149.6 million in 2018. In April 2019, Jumia listed on the New York Stock Exchange (NYSE) at a valuation of $1.1 billion and recorded a surge in sales arising from its NYSE debut. Konga was set up in 2012 as a competitor to Jumia, selling a wide range of products from home appliances to groceries. It merged with Yudala in May 2018 but continued to operate under the Konga brand name.  In November 2016, Konga launched Yakata, its version of black Friday sales and reached over 155,000 orders, valued at nearly ₦3.5 billion for the month alone. Most reports monitored around early 2019 indicate that the major e-commerce businesses in Nigeria are yet to experience any notable profit margins.
 

Major Buying Holidays

Nigeria is a multicultural society, dominated by two of the world’s major religions. 50 percent of the population is Muslim and about 40 percent is Christian. Christmas and Easter are celebrated widely, and the main Muslim holidays, Eid al Fitri, and Eid al Kabir are national holidays also widely celebrated. The standard New Year celebrations are also accompanied by shopping, dining and big parties hosted by the states.
 

Social Media

Nigeria is ranked number 7 for internet users in the world.  In 2018, about 22.4 million (11.2%) Nigerians were active Facebook users each month, Twitter ranked second with 8.35%, Pinterest ranked third with 7.08%, while many others also accessed YouTube.  The popularity of social media in Nigeria increases with mobile penetration and as data costs fall.  Access to local social media sites has also increased, and Nigerians are highly influenced by well-crafted social media advertising.  In line with the increasing internet penetration in Nigeria and use of social media by corporate organizations, the U.S Commercial Service Nigeria established its presence on social media in 2018, starting with Twitter. The agency’s official twitter handle is @USCSNigeria
 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.