The Nigerian Communications Commission (NCC) recently reported that Nigeria’s internet consumption reached 973,455 terabytes in December 2024, a 36.5% increase from the previous year. 

That’s 998.79 million gigabytes of data used in just one month. Despite this surge in demand, the country’s broadband penetration stood at 44.43%, far below the 70% target set in the National Broadband Plan (2020–2025). 

Even more concerning, Nigeria ended 2024 with 164.9 million active telecom subscribers—down from 224.7 million the year before.

Imagine streaming a movie now costing as much as a meal, and staying online feels like a privilege reserved for the wealthy. 

This sharp decline in active subscribers, even with the growing need for internet services, is leading to talks of Nigerians being unable to afford staying connected.

Inflation and currency devaluation have shot the industry’s costs of operations really high, leading to the Nigerian Communications Commission’s (NCC) recent approval of a 50% increase in telecommunications tariffs—the first such hike in over a decade—to help operators manage the high expenses. 

The Need for Inclusive Resilience in the Telecom Sector

This tariff increase has struck conversations across various bodies. The Nigeria Labour Congress (NLC) has labelled the hike as “insensitive” and “unjustifiable,” especially given the current cost-of-living issue. 

While telecom operators argue that the challenges leave them with no choice, consumers are wondering if affordable connectivity is becoming a thing of the past.

Inflation is wearing out disposable income, forcing consumers to prioritise essentials over data and call plans. Businesses, especially SMEs, rely heavily on telecom services, but higher costs threaten their ability to stay competitive.

The rural-urban gap in connectivity may expand, as rural consumers—who already struggle with access—may be priced out of the market.

In the midst of these challenges, the telecom sector must find ways to remain profitable without sidelining lower-income consumers. The key lies in resilient and inclusive strategies that balance affordability, sustainability, and growth.

Strategy 1: Tiered and Flexible Pricing Models

1. The Power of Segmentation in Telecom

To effectively serve a diverse customer base, telecom operators should segment their users into low-income, middle-income, and high-income categories. This segmentation allows for targeted services that meet the specific needs and financial capabilities of each group.

2. Implementing Flexible Pricing Structures

• Pay-as-you-go options: Ideal for price-sensitive users who prefer to control their spending without committing to fixed plans.
• Subscription models: Offer middle-income consumers affordable packages with predictable billing cycles.
• Premium services: Provide high-income users with enhanced features such as high-speed internet and exclusive customer support.

3. Strategy 2: Infrastructure Cost Optimisation Through Public-Private Partnerships (PPP)

1. The High Cost of Expanding Telecom Network Infrastructure

Building and maintaining telecom infrastructure, such as towers and broadband cables, require huge capital investment. Inflation further increases these costs, making it challenging for operators to expand and upgrade their networks.

2. Leveraging PPP to Reduce Financial Stress

Collaborating with government entities and development banks can help telecom operators share the financial risks associated with infrastructure projects. For example, partnerships can be formed to extend network coverage to underserved rural areas, with shared investment and benefits.

In Kenya, the government and private telecom operators have partnered to expand rural connectivity, resulting in increased access to communication services in previously underserved regions.

Initiatives like the National Optic Fibre Backbone Project and partnerships with telecom providers such as Safaricom, Telkom Kenya, and Airtel have helped boost this.

Strategy 3: Digital Transformation and AI-Driven Efficiency

1. How Digital Transformation Can Lower Costs

Leveraging digital tools and automation can simplify operations, reducing the need for manual intervention and lowering operational expenses. For instance, AI-powered network management systems can optimise bandwidth usage and predict maintenance needs, thereby reducing downtime and associated costs.

2. The Impact on End-Users

Customers benefit from faster and more efficient services, such as AI-driven customer support that can handle inquiries promptly. These efficiencies can lead to cost savings for operators, which can be passed on to consumers in the form of more affordable services.

Strategy 4: Expanding Alternative Revenue Streams

1. Moving Beyond Traditional Revenue Models

Relying solely on voice and data services is becoming more and more unsustainable. Diversifying into areas like financial technology (fintech), cloud services, and the Internet of Things (IoT) can open new revenue streams. This is seen in MTN’s transition to a Techco.

2. Monetising Digital Services

• Mobile money and payment solutions: Offer financial services to unbanked populations, generating transaction fees.
• Entertainment bundles: Partner with streaming services to provide bundled offerings, enhancing value for consumers.

MTN’s MoMo, Airtel Money and Safaricom’s M-Pesa are prime examples of telecom operators successfully launching into mobile financial services, greatly contributing to revenue growth.

Strategy 5: Strengthening Local Supply Chains to Mitigate FX Risks

1. The Problem of Foreign Exchange Dependency

Heavy reliance on imported equipment makes telecom operators vulnerable to currency fluctuations, increasing costs unpredictably.

2. Investing in Local Manufacturing and Partnerships

Developing local production capabilities for items like SIM cards and network components can reduce foreign exchange exposure. Partnering with local tech firms can also promote innovation and cost-effective solutions tailored to the local market.

Strategy 6: Data-Driven Decision Making for Telecom Customer Retention

1. The Cost of Customer Churn in an Economic Downturn

Losing customers can be more expensive than retaining existing ones, especially when inflation reduces consumers’ disposable income. High churn rates force telecom companies to spend more on marketing and customer acquisition, which can negatively impact already tight budgets.

2. Leveraging Big Data and Analytics for Personalised Offers

Telecom operators can use customer data analytics to identify usage patterns, predict churn risk, and design personalised retention strategies.

• Usage-based incentives: Offering discounts or data bonuses to customers who frequently recharge can encourage continued engagement.
• Loyalty rewards: Retaining long-term customers through perks such as discounted family plans or exclusive streaming deals.

MTN and Airtel have successfully used data analytics to provide dynamic pricing models, such as location-based discounts and time-sensitive data plans, reducing churn and boosting customer satisfaction.

Strategy 7: Strengthening Regulatory and Industry Collaboration in Telecom

1. The Impact of Government Policies on Telecom Viability

Government policies on taxation, spectrum licensing, and price regulations are important in determining telecom sector stability. The recent 50% tariff hike approved by the Nigerian Communications Commission (NCC) is an example of how policy decisions directly affect consumers and telecom operators.

2. Advocacy for Fair and Sustainable Policies in the Telecom Sector

Telecom companies must engage policymakers and industry regulators in constructive dialogue to ensure that tariff adjustments, tax structures, and regulatory frameworks balance profitability with affordability for consumers.

3. Encouraging Investment-Friendly Policies in the Telecom Sector

• Reducing multiple taxation: Telecom firms should advocate for streamlined tax policies to prevent excessive levies that inflate operational costs.
• Incentives for rural expansion: Government support, such as tax breaks for rural infrastructure projects, can make connectivity more accessible in underserved areas.

Regulatory frameworks can encourage competitive pricing while ensuring telecom operators remain profitable.

Summary of Key Points

Though there are economic pressures like inflation, telecom operators can thrive and ensure inclusive connectivity by implementing seven key strategies:

1. Tiered and flexible pricing models to serve all income groups.
2. Public-private partnerships (PPP) to reduce infrastructure costs.
3. Digital transformation and AI for cost efficiency.
4. Diversifying revenue streams beyond data and voice services.
5. Strengthening local supply chains to reduce foreign exchange risks.
6. Using data-driven strategies to retain customers.
7. Collaborating with regulators to ensure fair pricing policies.

The Lot of Resilient Connectivity

With smart, adaptive strategies, telecom operators can continue to deliver quality services across all economic segments while mitigating the impact of inflation.

The telecom sector must act assertively by adopting innovative pricing, infrastructure investment, and customer-centric solutions. 

Regulators, industry leaders, and consumers must collaborate to ensure that connectivity remains affordable, sustainable, and inclusive—regardless of economic conditions.

In the 90-minute session, the experts analysed the current prevailing macroeconomic challenges in the country and emphasised the importance of adopting a digital mindset for entrepreneurial success.

The webinar titled, ‘Keeping Your Cash Flowing: Simple Tips for Small Business Owners’, was attended by more than 140 business owners from across Nigeria keen to gain insights to navigating their businesses.

In a 20-minute presentation that preceded the panel discussion and Q & A session, Rewane provided an overview of Nigeria’s evolving economic landscape.

He highlighted the impacts of currency devaluation, FX losses, minimum wage reviews, high inflation, interest rates and borrowing costs, squeezed margins, and the declining consumption, on businesses in general.

He said,

“In 2014, Nigeria was Africa’s largest economy; about 23% of Africa’s GDP was in Nigeria and we were the sixth largest oil producer in the world. 10 years later, things have changed. By 2017 we had gone into recession, followed by Covid-19 and another recession in 2020…these factors all have a significant impact on small businesses today.’’

Despite these challenges, he stressed that small businesses can still succeed by adopting a digital mindset, building efficient operating models, and tapping into high growth sectors such as agriculture, healthcare, telecommunications, media, renewable energy, real estate, and tourism. Rewane also encouraged small business owners to persevere, noting that many mega-corporations, including Amazon, started as small businesses.

He cited Amazon‘s journey from a garage-based online bookstore in 1994 to a $2 trillion enterprise.

Speaking at the webinar, Uzoma Dozie highlighted that adopting a digital mindset can enhance small business operations, reduce costs, and enable data-driven decision-making.

He shared that Sparkle supports this transition by providing tools for expense tracking, invoicing, payments, performance monitoring, payroll, savings, and investments, all through a mobile app.

Omon Anenih shared her entrepreneurial journey, advising small business owners to manage cash flow effectively by planning, tracking expenses, cutting costs without sacrificing value, staying lean, making data-driven decisions, and diversifying revenue streams.

She underscored the importance of digital tools in boosting productivity and profitability, saying, “Cash flow is the lifeblood… digital is your friend.”

Sparkle Business simplifies business management for small and medium enterprises, allowing them to monitor activities, manage products and customers, identify top-selling products and high-patronage customers, and track business metrics, all from a mobile device.

The webinar was moderated by Nneka Okekearu, director of the Enterprise Development Centre at Pan-Atlantic University.

The IMF forecasts a slight increase in Nigeria’s government debt-to-GDP ratio to 46.6% in 2024, up from 46.3% in 2023.

This was revealed in the IMF’s fiscal monitor report released during its spring meetings with the World Bank in Washington, D.C.

According to the IMF’s World Economic Outlook, here are the top 10 largest Economies in Africa in 2024.

1. South Africa

South Africa leads with a GDP of $373 bn, solidifying its status as Africa’s most industrialized economy. Renowned for its diverse economic profile, South Africa embraces sectors such as mining, agriculture, manufacturing, and services, shaping a multifaceted economic landscape.

2. Egypt

Egypt commands a GDP of $347 bn, leveraging its strategic geographical position as a bridge between Africa and the Middle East.

Historically, Egypt has served as a pivotal hub for trade and commerce.

Its economy thrives on a robust tourism sector, agriculture, manufacturing, and a burgeoning ICT industry, cementing its significance in the regional and global economic arena.

3. Algeria

Algeria has a GDP of $266 bn, primarily fuelled by its abundant natural resources, notably oil and gas, which drive its economy through hydrocarbon exports.

Nevertheless, recent government initiatives prioritize economic diversification, aiming to diminish reliance on oil revenues and promote sustainable growth across diverse sectors.

4. Nigeria

Nigeria often hailed as the “Giant of Africa,” holds the fourth position on the list, and has a GDP of $252 billion. With its expansive population and rich endowment of natural resources, particularly oil, Nigeria harbours the potential to ascend as one of the globe’s foremost economies.

5. Ethiopia

Ethiopia commands a GDP totalling $205 bn. Acknowledged for its impressive economic metamorphosis of late, Ethiopia has drawn substantial foreign investment, notably in sectors like agriculture, manufacturing, and infrastructure.

Given its strides, Ethiopia’s economic advancement bears profound significance for the broader growth trajectory of the continent.

6. Morocco

Morocco with a GDP of $152 bn, is celebrated for its stability and strategic positioning as a crossroads between Africa, Europe, and the Middle East. Its economy flourishes across various sectors such as agriculture, tourism, manufacturing, and renewable energy. Government-led initiatives geared towards promoting entrepreneurship and innovation are propelling Morocco’s economic strength and global competitiveness.

7. Kenya

Kenya, boasting a GDP of $104 bn, holds the position of East Africa’s largest economy. Geared by a dynamic entrepreneurial culture and an expanding middle class, Kenya has established itself as a pivotal economic centre in the region.

Key sectors driving its GDP growth include agriculture, tourism, financial services, and technology, underpinning Kenya’s economic vibrancy and regional influence.

8. Angola

Angola has a GDP totalling $92 bn, endowed with extensive oil reserves that historically engineered its economy through exports.

Yet, in recent times, the government has initiated ambitious economic diversification endeavours, targeting a reduction in oil revenue dependence and the promotion of inclusive growth.

9. Cote D’Ivoire

Cote D’Ivoire has a GDP of $86 bn, marking a notable economic resurgence following years of political turmoil.

This turnaround is propelled by strategic investments in infrastructure, agriculture, and manufacturing.

With a youthful demographic dividend and an increasingly favorable business climate, Cote D’Ivoire stands poised for enduring economic expansion.

10. Tanzania

Tanzania concludes the list with a GDP totalling $79 bn. Endowed with plentiful natural resources and a varied agricultural sector, Tanzania offers extensive prospects for investment and growth.

Government-led initiatives focusing on infrastructure enhancement, industrialization promotion, and business climate improvement serve as pivotal drivers for Tanzania’s economic advancement agenda.

African countries, is blessed with abundant resources, growing populations, and increasing investments, have emerged as notable economic players.

The International Monetary Fund (IMF) report shows the continent’s economic progress and potential.

Despite facing individual challenges, concerted efforts in economic diversification, infrastructure development, and institutional reforms are essential to unlock Africa’s full economic potential and ensure a prosperous future.

The IMF forecasts South Africa, Africa’s most industrialized nation, to lead as the continent’s largest economy with a GDP of $373 billion, a position it’s expected to maintain until 2027.

Egypt, previously at the top in 2023, is projected to fall to second place, largely due to currency devaluations.

Currency devaluation refers to the decline in the value of a country’s currency relative to other currencies in the world.

It can be caused by various internal or external factors. For example, weak economic fundamentals, such as high inflation, low GDP growth, high levels of debt or low foreign reserves, can erode investor confidence and lead to a decrease in demand for the currency, resulting in it losing value. 

According to Nadeem Anjarwalla, Director for Binance in West & East Africa, while currency devaluation can be used as a tool by governments to boost exports, stimulate economic growth, or reduce trade deficits, it can also have negative consequences for the economy and people of the country concerned. 

“Currency devaluation can erode the purchasing power of people’s money, cause inflation levels and the costs of living to increase, and create uncertainty in financial markets,” Anjarwalla explains, “all of which can result in reduced standards of living for consumers and less certainty when it comes to growing their money through traditional savings and investment vehicles.”

However, Anjarwalla points out that there is a solution to the challenge of currency devaluation and the impacts that a declining currency can have on people’s financial well-being. “Stablecoins provide a practical solution for African consumers to hedge against the currency devaluation that many countries on the continent are facing,” he explains, “by offering a stable way of growing the value of their money, easy digital access to their funds, and a steadily increasing number of opportunities to use Stablecoins to do secure cashless transactions.”

Stablecoins are a type of cryptocurrency that is pegged to a stable asset, like a traditional currency such as the US dollar, or a commodity like gold.

This allows Stablecoins to maintain steady value and be less susceptible to the volatility often associated with other cryptocurrencies. These attributes make Stablecoins a reliable hedge against currency devaluation, even in uncertain economic conditions. 

“One of the most valuable aspects of Stablecoins in an environment of currency devaluation is that they offer a secure and efficient means of saving and growing money, making them a reliable option for long-term savings,” Anjarwalla explains, “So, African consumers can save their money in Stablecoins, secure in the knowledge that its value will remain relatively stable over time, and even have the potential to grow, regardless of the fluctuations happening in their country’s local currency.”

And the benefits of Stablecoins are not limited to their savings potential. They also offer fast and low-cost cross-border payments and transfers, making them a convenient option for remittances and international transactions. “African consumers can use Stablecoins to send and receive money across borders quickly and efficiently,” Anjarwalla  says, “without being faced with a situation where currency devaluation in the recipient’s country means that the money is worth less when it reaches its destination.”

Anjarwalla points to the convenience and accessibility of Stablecoins as another compelling reason why growing numbers of consumers in Africa are turning to these innovative currencies to enhance their financial resilience in difficult economic times.

“People can easily convert their local currency into Stablecoins through peer-to-peer exchanges or decentralised finance (DeFi) platforms,” he says, “ and they can then easily access their Stablecoins through cryptocurrency exchanges, like Binance (Binance.com), which provide a user-friendly platform for buying, selling, and trading the coins. What’s more, an increasing number of fintech companies in Africa are incorporating Stablecoins into their payment systems, enabling consumers to transact directly with them to pay bills, invest, and purchase everyday goods and services.” 

He points out that, as the demand for Stablecoins continues to grow in Africa, leading cryptocurrency exchanges, like Binance, are actively supporting their adoption on the continent as a viable way to counteract growing economic uncertainty and ongoing currency devaluation.

“As one of the largest cryptocurrency exchanges in the world, Binance offers a wide range of Stablecoins, including Binance USD (BUSD), Tether (USDT), USD Coin, TrueUSD, and Dai (DAI),” he says, “which are pegged to the US dollar and provide a reliable hedge against currency devaluation for African consumers.” 

“By providing a secure and convenient platform for buying, selling, and using Stablecoins, Binance is not only offering African consumers a reliable and accessible option to safeguard their financial future by countering the negative impacts of currency devaluation,” Anjarwalla says, “but we are also contributing to greater financial inclusion and economic empowerment and resilience on the continent.”