BrandArena: Visa Study Reveals Emerging Trends and Opportunities for Nigerian SMEs, Highlights Potential for Issuing Banks

Monday 27 May 2024

Visa Study Reveals Emerging Trends and Opportunities for Nigerian SMEs, Highlights Potential for Issuing Banks

Visa’s latest report, the SME Megatrends study, explores the dynamic financial landscape for Small and Medium Enterprises (SMEs) in Nigeria. The study highlights significant growth opportunities, particularly in digital and financial sectors, providing key insights for issuing banks to leverage for new revenue streams and competitive advantages.

Nigerian businesses are undergoing substantial transformation driven by high internet and social media penetration, prompting SMEs to establish an online presence. The rise in e-wallet usage is accelerating digitalization, creating a demand for robust, user-friendly tools to support e-commerce expansion. However, SMEs face challenges such as underfunding and limited access to formal credit, which are essential for business growth and managing daily cash flow.

The swift digital progress in Sub-Saharan Africa’s SME sector presents issuing banks with lucrative opportunities. By facilitating access to crucial financial products and services, banks can capitalize on this growth, expanding their customer base, increasing transaction volumes, and boosting revenue within the digital payments landscape. Partnering with Visa enables issuing banks to offer customized financial solutions tailored to SMEs’ unique needs, thereby fostering inclusive economic growth.

Andrew Uaboi, Vice President, and Head of Visa West Africa, remarked, “At Visa, we are dedicated to empowering issuing banks to tap into the vast potential of SME financing, focusing on bridging the critical funding gaps that impede SME growth - an approach that involves transforming challenges into tangible opportunities. We are confident that the insights provided by the SME Megatrends report will empower banks to enhance their services. Through strategic partnerships with these banks, we aim to offer the essential resources required to develop tailored financial solutions that meet the specific needs of SMEs." 

The Visa SME Megatrends report serves as an indispensable tool for issuers to better understand SME needs while identifying actionable strategies to customize their offerings for this market segment. Crucially, the report reaffirms Visa's unwavering commitment to expanding SMEs' access to the digital economy, fostering a resilient and mutually beneficial business environment for all stakeholders.

Spotlight on Nigeria’s SME landscape
Key insights from the Nigeria SME Megatrends report:
1. Greater Desire for Formalized Financial Services: SMEs in Nigeria remain heavily underserved and underbanked. With SME card penetration at a nominal level, businesses seek improved access to accessible, affordable formal financial services. 
2. Need For Easier Access to Credit to Facilitate & Optimize Cash Flow: A considerable amount of SMEs rely on personal loans and informal credit, as they face obstacles and requirements that make it difficult to secure loans from banks and other formalized lending institutions.  
3. Integration with Social Media Platforms & Communication Tools to Drive Sales: Nigeria’s digital advertising landscape is evolving quickly, contributing to the growth of e-commerce and digital payments. Streamlined and user-friendly tools are helping SMEs establish an online footprint to compete and drive sales. 

4. E-Wallets are Playing a Growing Role in Digitizing SMEs: E-Wallets are building ecosystems where consumers and businesses interact and  are well-positioned to increase digital and payment card acceptance among SMEs.
5. SMEs Need Support To Build an Online Presence: The rapid growth of mobile and internet penetration in Nigeria is creating a latent demand for SMEs to develop online presence and ecommerce capabilities to reach new customers, with a need for robust and simplified tools to enable access. 
6. Moving Towards Real-Time Payments: As real-time payments expand, SMEs will come to expect to pay and be paid faster. 
7. Investment in SME Digitization Tools is Increasing: Lack of digitization remains a major challenge for SMEs but a growing fintech ecosystem is bringing new, locally oriented digitization tools to market.

Empowering the Ecosystem, Powering Growth
Visa recognizes the pivotal role of SMEs in driving economic growth and is committed to integrating them into the digital economy. Through its extensive network, innovative business solutions and value-added services, Visa collaborates with issuing banks to facilitate SME access to digital tools and financial services, bolstering the digital transformation of SMEs.

Visa has already digitally enabled nearly 67 million SMBs worldwide, leveraging its extensive expertise and partner network, exceeding our three-year goal of digitally enabling 50 million SMBs globally. This achievement underscores Visa's profound expertise and the strength of its partnerships. By pinpointing ways for issuers to provide SMEs with vital financial products and services, Visa seeks to foster economic growth collaboratively. This effort not only aids SME development but also contributes to a flourishing cycle of prosperity, offering substantial benefits for the economy at large.

Read Visa’s Nigeria SMEs Megatrends report here, and discover how Visa’s SME products and services can be leveraged by issuers in the country.


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  2. I have been observing several trends that the latest study conducted by Visa has revealed, as we operate a small business in Nigeria. The focus of the study is on the huge potential of SMEs and their capabilities in terms of growth and innovation in the financial and digital industries. The everyday expansion of web presence and commerce has fostered an unfulfilled demand for simple solutions to enhance the appearance of our online presence. Thus, in my opinion, as a businessman, project assignment help with issuing banks, with the help of which, and with the additional support of specific financial products, it will be possible to come out into the current conditions victorious.