Onome Amuge
Nigeria’s informal sector, long regarded as the engine of the country’s economy, faces a notable financial vulnerability, with nearly half of its operators unable to survive more than a month without income, according to new research from Moniepoint Microfinance Bank.
The findings, part of the Nigeria Informal Economy Report 2025 due to be launched on October 17 in Abuja, reveal the extent to which millions of micro and small-scale entrepreneurs operate without financial buffers or access to formal financial services. The study was supported by the Ministry of Industry, Trade and Investment and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN).
The data come at a time when policymakers are seeking to expand the tax base and formalise economic activity amid fiscal pressures and sluggish growth. Yet, the research underscores how financially exposed the informal sector remains, despite its role in sustaining livelihoods for more than 80 per cent of the workforce and accounting for most of Nigeria’s non-oil economic output.
Babatunde Olofin, managing director, Moniepoint, described the study as a robust and important analysis that curates fresh insights into the realities of Nigeria’s informal economy. He said its findings should guide both government and financial institutions in “policy direction and execution.”
Moniepoint’s research is expected to add empirical weight to ongoing debates about how to formalise the sector without overburdening it. Analysts say that beyond tax and regulatory reforms, access to low-cost digital banking, micro-insurance, and savings tools could help small traders and artisans build resilience.
The launch event, which will gather senior officials, regulators, lawmakers, and business leaders, will feature panel discussions and policy dialogues on strategies to bridge the gap between informal operators and the formal economy.
The 2025 report builds on the inaugural edition released two years ago, which was widely praised for providing credible data and actionable recommendations. This year’s edition comes amid rising economic uncertainty and is expected to serve as a crucial barometer for Nigeria’s efforts to build a more inclusive financial system.
