In a recent survey carried out on the challenges of small-scale enterprises in Nigeria for an international development association (IDA) by Fame Oyster & Co. Nigeria, 89 percent of the small-scale business owners interviewed claimed lack of funds is their bane. Eighty-three percent (83%) said they were not using any form of digital tools like CRM (customer relations management) tool (WhatsApp business, Calendly, HubSpot and Zoho), project management (Asana, Trello), accounting (QuickBooks, Xero), marketing (Mailchimp and Hootsuite), communication (email, FieldEdge, Zoom) etc; 82.7 percent claimed men in small-scale businesses have better business opportunities than women and youths; 79 percent of Nigeria’s small-scale businesses do not have or operate bank accounts and 76 percent do not know or have customer retention programme.
Small-scale businesses are businesses that have limited size and resources (between 1 – 40 workers and less than N10 million working capital), typically defined in Nigeria by the number of employees (less than forty) or annual revenue (turnover of less than N25 million per annum), according to Nigeria’s Finance Act 2019.
Small-scale enterprises often provide significant employment opportunities by forming at least 70 percent of the businesses in developing nations, especially in local communities and they reduce abject poverty among citizens.
Small businesses account for 99.9 percent of all businesses in the United States and they also employ nearly half of the private sector employees in the country. They are defined as those employing 500 employees or fewer. In the Indian economy, 96 percent of the industrial units belong to small companies (small-scale businesses). The small companies account for 40 percent of the nation’s overall industrial production and 42 percent of all Indian exports. Small companies also offer various opportunities in the rural and urban areas of the country.
In the UK, SMEs (small and medium-sized enterprises) account for 99.85 percent of the business population (2026 data). Ninety-five percent (95%) are micro enterprises employing between 1 – 5 workers. At the start of 2025, there were estimated to be 5.7 million UK private sector businesses. 1.4 million (25%) businesses had employees and 4.3 million (75%) did not employ anyone aside from the owners (sole proprietors).
Running some qualified businesses from home may be mutually beneficial to the government and the business owners. To run a business from your home, you may need permission from the following stakeholders:
• Mortgage provider or the landlord of your house or the community development association (CDA).
• Physical planning authority if you wish to make major alterations or additions to your home according to the planning laws.
• Ministry of Commerce, Trade and Investment if you will be receiving customers in your home and you need approval to do that. You will also need to visit the signage agency of your state if you want to advertise your business name outside the business premises.
Insurance: You may need insurance for your business. Home insurance may not cover your business (such as stock, computers and accidents of customers visiting your premises).
Tax obligations: You will need to visit the tax office nearest to your community to find out your tax obligations including exemptions for new businesses and the free training that you are entitled to. If you are operating business from home, you can claim a proportion of the cost of things like land use charge, electricity bill, phone calls and broadband from your tax payable.
Payment of business rates: You may have to pay business rates on the part of your property that you use for your business to the state as land use charge. The estate surveyor and valuer can assist to determine the correct amount you will pay.
The following are the three critical areas that the government can intervene to assist small-scale businesses.
1. Promote access to sustainable finance: Each year, about 40 percent of small and medium-scale enterprises in developing countries encounter unmet financing demands. Most of the unmet demands lie in the informal sector. Timely access to finance at affordable terms is a necessary lifeline for micro, small and medium-scale enterprises (MSMEs) in developing nations as they navigate the complexities of evolving local, regional and global realities. Vital access to sustainable finance is not just about providing funds; it is about fuelling sustainable growth and ethical business practices, enabling MSMEs to leverage opportunities, to pursue sustainable expansion, green and blue innovation, and market diversification, all while contributing to a healthier, more sustainable and transformed economies. The federal government of Nigeria is trying by providing cheap finance for small and medium enterprises, especially through the Bank of Industry.
2. Create an enabling environment for women and youth-led businesses: Globally, women-owned MSMEs account for 38 percent of the MSME sector. Women and youth owned enterprises account for 76 percent of businesses in Nigeria. Nonetheless, 70 percent of women entrepreneurs are facing limited access to credit and market opportunities. In Lagos State, for instance, women-owned MSMEs had an unmet credit demand of $250 million in 2025. Supporting women and youth entrepreneurs is critical for addressing income and non-income inequalities and building resilient prosperity at local and national levels. Empowering women and youth drives economic progress, societal advancement, and leads to a brighter future. From information technology (IT), real estate, agriculture and healthcare to renewable energy, youth-led enterprises are reshaping Nigeria’s economy. Nigerian youths, with their exploit in music, are ready to dazzle, if supported, with the creation of an enabling environment. This environment includes training for capacity enhancement.
3. Ensure an inclusive digital transformation for MSMEs owners: Digital technologies, including artificial intelligence (AI), are altering the business landscape of almost every country in the world. Nigeria is fast positioning itself as one of the world’s most enthusiastic and innovative adopters of AI, according to a new report by Google in partnership with Ipsos. The study entitled “Our Life with AI: Helpfulness in the hands of more people”, shows that Nigerians are not merely experimenting with AI tools but are integrating them deeply into learning, work and entrepreneurship outpacing global averages by a wide margin.
According to the survey, 88 percent of Nigerian adults have used an AI chatbot, representing an 18-percentage-point increase from 2024. This places Nigeria significantly ahead of the global average of 62 percent, underscoring the country’s rapid embrace of emerging technologies. The transformative impact of AI has reached across industries, reshaping their operations, decision-making processes and customer interactions and in certain sectors, even job security. AI and other digital technologies also represent powerful tools for data-driven insights, supply chain optimization and personalized customer engagement, facilitating competition. Unfortunately, small-scale businesses majorly lack the technical ability to embrace AI. Most MSMEs owners also lack managerial abilities and financial literacy.
As Nigeria, under President Bola Ahmed Tinubu, embarks on measures to sustainably develop the country, especially entrepreneurship, the vital role of MSMEs in transforming the economies will continue to grow. Providing meaningful assistance, capacity building, a coherent regulatory environment and laying effective policy frameworks will facilitate the positive evolution of MSMEs in developing nations, empowering them to navigate, innovate and thrive in a competitive business environment.
When applause travels faster than hunger