Where is Nigeria’s Digital Economy in 2026?

Nigeria’s digital economy has increasingly been positioned as a cornerstone of national development. With the promise of job creation, innovation, and improved public services, the sector holds enormous potential for economic transformation. However, translating this potential into measurable impact requires strong policy implementation that still appears to be insufficient. In a recent outlook conducted by Yiaga Africa assessing the fulfilment of President Bola Ahmed Tinubu’s digital economy policies between 2023 and 2025, findings show a mixed picture with notable progress in some areas and significant gaps in others.

One of the strongest areas of performance is Nigeria’s startup and innovation ecosystem, which recorded the highest rating of 3.75 in the policy brief by Yiaga Africa using the GovTech index key across 9 key performance areas on a numerical performance scale of 1-5. The government significantly exceeded its target under the Startup Act, registering nearly 12,948 startups compared to the initial goal of 500. In addition, about 925 government-backed innovation hubs have been established across the country.

While these figures reflect an active entrepreneurial landscape and growing interest in technology-driven solutions, the assessment notes that access to finance remains a major obstacle, largely because grant disbursement processes are slow and tax relief mechanisms lack transparency.

Another area of progress is talent development, which scored 3.0. Flagship initiatives such as the 3 Million Technical Talent (3MTT) program have trained approximately 600,000 individuals as of 2025. Programs like the Build-A-Thon initiative have also exceeded expectations in reaching students and introducing them to digital skills. Despite this momentum, a key challenge lies in translating training into employment.

According to the assessment, only 7.7 percent of trainees secured employment within six months of completing their programs, highlighting a disconnect between skills training and labour market demand. Without stronger partnerships between training programs and employers, Nigeria risks producing a large pool of skilled individuals who struggle to find opportunities to apply their knowledge.

In digital infrastructure, progress remains modest. The sector recorded a rating of 2.5, with approximately 145,000 kilometres of fibre optic cable deployed nationwide, representing about a ten percent increase compared to pre-2023 levels. While this expansion is significant, rural connectivity remains a major challenge, with only 27 percent of rural local government areas currently connected, far below the government’s target of 60 percent.

The most concerning performance appears in e-government and digital services, which scored 1.75. Despite growing calls for government modernisation, fewer than 20 percent of federal services are fully digitised. This limits the efficiency and accessibility of public services that digital tools are supposed to enhance. Furthermore, national identification coverage remains incomplete. The National Identification Number (NIN) currently covers roughly 51 percent of the population, significantly below the 95 percent target set for 2025.

These uneven outcomes are driven by several structural challenges. One major issue is policy fragmentation. Key institutions such as the National Information Technology Development Agency (NITDA), the Nigeria Data Protection Commission (NDPC), and the Federal Ministry of Communications, Innovation and Digital Economy frequently operate in silos. Overlapping mandates in areas like data protection and cybersecurity can result in duplicated efforts and regulatory confusion.

Infrastructure constraints further compound these challenges. High Right-of-Way (RoW) fees imposed by state governments continue to slow broadband expansion, particularly in underserved regions. In addition, unreliable power supply and expensive spectrum costs further complicate efforts to scale digital connectivity nationwide. These barriers make it difficult to extend digital services to communities that need them most.

Another obstacle is the slow pace of legislative reform. The Digital Economy Bill, which could provide a comprehensive regulatory framework for the sector, remains pending in the National Assembly. This delay contributes to uncertainty for investors and innovators alike, potentially slowing the pace of growth in the sector. Inclusion challenges also persist with many digital programs concentrated in urban centres, limiting participation from women, persons with disabilities, and rural populations, particularly in northern states.

To address these challenges and meet the objectives of the government’s Renewed Hope agenda by 2027, the assessment outlines several recommendations. First, stronger inter-agency coordination is essential. Establishing a dedicated Digital Economy Delivery Taskforce could help harmonise the work of institutions such as NITDA, the Nigerian Communications Commission (NCC), and Galaxy Backbone.

The government must also accelerate reforms by prioritising the passage of the Digital Economy Bill and fully implementing the Startup Act. Furthermore, collaboration with subnational governments is crucial, as state-level ICT agencies must play a greater role in addressing last-mile connectivity challenges and reducing Right-of-Way fees that hinder broadband expansion.

The report also emphasises the role of public–private partnerships, particularly with major telecommunications companies such as MTN and Airtel, in scaling infrastructure and expanding digital training hubs. Finally, policymakers must take deliberate steps to promote local content, including enforcing procurement standards that prioritise indigenous digital solutions.

Overall, the assessment finds that Nigeria’s digital economy is clearly moving forward, but progress remains uneven. The country has demonstrated strong potential in innovation and talent development, yet critical weaknesses persist in governance, infrastructure, and inclusion.

Read more on the #FulfillIt campaign by Yiaga Africa here