This transition dictates how businesses grow and survive in the new year, and the next decade at large.

Recent data shows about 95% of businesses in Africa are SMEs, and they contribute roughly 40% of the continent’s GDP and more than half of its jobs. Most of these firms are now part of digital ecosystems where data flows through every transaction and interaction.

That alone is reason enough to pay attention.

Why the Shift to Data is Important

In the early phase of digital adoption (roughly 2015–2022), the story was about embracing digital payments, online stores and basic apps. 

By 2025, that matured. Digital transactions are now the norm. For example, surveys show over 99% of SMEs in Nigeria accept digital payments, and in South Africa around 90% of SMEs do the same, not just to be modern, but because it improves financial management, cash flow and customer access. 

These payment records generate data. And the most forward-thinking firms are going beyond collecting that data to acting on it.

Data is being used to:

• Spot slow-moving inventory weeks before stockouts happen
• Predict which customer segments are most profitable
• Adjust pricing after analysing local demand shifts
• Evaluate creditworthiness based on transaction histories

This is happening now and companies that learn to turn raw numbers into decisions are gaining advantage.

What “Data-Driven” Really Looks Like on the Ground

Being data-driven doesn’t mean you need a team of PhDs or massive budgets. For African SMEs in 2025, it meant practical actions:

1. Operational Decisions Replace Guesswork

Business owners are looking at sales patterns weekly, not just quarterly. They monitor which products sell at different times and adjust inventory accordingly. Even simple dashboards from payment providers can reveal trends previously invisible.

2. Digital Banking and Lending Get Smarter

Banks across Africa are investing heavily in SME services that use data, not paper forms, to evaluate credit risk. A recent industry report shows 83% of banks now treat SME banking as a strategic priority, using mobile platforms and analytics tools to serve these clients better. 

Mobile banking is especially important because it reaches businesses in rural or underserved regions. These platforms also generate data that lenders and firms can use to make decisions faster and with less bias.

3. Adoption Still Uneven, But Growing Fast

While basic digital tools are widely used, sophisticated data usage is still emerging. Digital onboarding (where a business can open an account entirely online) is fully available in only around 42% of cases, showing that there’s still work to be done.

Unreliable internet in some regions, high data costs, and skill gaps are causing limitations. But where these challenges are overcome, businesses are already seeing results.

The Economic Importance

If SMEs are the backbone of economic activity, and evidence says they are, then better decision-making at this level scales into macro performance:

• Greater resilience to shocks: Firms that read their own data can react quicker to supply delays, currency swings or demand drops.
• Improved access to finance: Data signals help lenders reduce risk, which expands credit availability. Digital lending products using analytics are growing in availability.
• Higher productivity: Data helps reduce waste and simplify operations, both essential in thin-margin environments where small inefficiencies compound quickly.

Enhanced data use directly influences how investment is allocated and how business strategies evolve.

Lessons from 2025

As the year closes, let’s take a look at a few patterns:

1. Digital adoption is widespread, especially for payments and banking interfaces.
2. True data usage is growing, but uneven across regions and sectors.
3. Financial institutions are doubling down on data-enabled services like mobile banking and analytics.
4. Infrastructure continues to improve, with new data centres and cloud partnerships aimed at reducing costs and boosting speed. 

Looking Forward to 2026

If 2025 was the year data went from novelty to necessity, then 2026 will be the year businesses start competing on it.

I expect the following trends to become more visible:

• SMEs using predictive analytics at scale, not just reporting what happened, but anticipating what will.
• Data literacy emerging as a core business skill, not a bonus.
• Policy and infrastructure balance, as governments and service providers invest in reducing data costs and expanding connectivity.

For anyone leading an SME in Africa, pay attention to the fact that technology without data just sits on a shelf. Data is what turns technology into decision power.

In its latest country report, the organisation stated that aside premising the prediction on higher-than-expected crude output, it is also based on earlier-than-expected production from the new mega-refinery in Nigeria.

The Economist Intelligence Unit (EIU) is the research and analysis division of the Economist Group. It provides forecasting and advisory services through research and analysis, such as monthly country reports, five-year country economic forecasts, country risk service reports and industry reports.

According to the EIU, hydrocarbons generate about 50 per cent of government’s revenue and more than 80 per cent of export receipts, but explained that agriculture and services dwarf the industry’s contribution to the Gross Domestic Product (GDP).

“The oil sector constitutes about 6 per cent of GDP. The higher growth forecast has come despite sharper-than-expected monetary tightening in February 2024. We now expect the Central Bank of Nigeria (CBN) policy rate to peak at 23.75 per cent, 200 basis points higher than our previous forecast,” it added.

Commenting on the current reforms by the administration of President Bola Tinubu, Nigeria’s Proshare quoted the EIU as highlighting that market reforms were intended to attract investments but did not constitute a coherent plan.

The two flagship policies, the elimination of petrol subsidies and the liberalisation of the exchange rate,  have an inner contradiction.

“As Nigeria imports virtually all its fuel, naira devaluations, the latest being a 45 per cent drop in February 2024, should be reflected in the pump price. However, owing to the threat of industrial action, there has been little movement since June, despite the naira having weakened from N461/$1 in May 2023 to N1,600/$1 in late February 2024. This indicates the return of (large) subsidy,” it said.

It further stated that a large naira devaluation in early February will likely herald further depreciation, as inflation remains high and real short-term interest rates remain negative.

“Falling risk premiums on government international bonds make tapping the international capital market another viable (albeit costly) option once US interest rates start to fall from the second half of 2024.

“For most of this year, the naira will be highly volatile, leading to regulatory erraticism that can affect businesses, especially those holding foreign currency. The CBN lacks the liquidity to support the naira itself; out of $33 billion in foreign reserves, a large share (estimated at nearly $20 billion) is committed to various derivative deals,” the report said.

According to the EIU, the Nigerian business environment will remain highly challenging, undermined by corruption, cronyism, rampant insecurity, and a giant infrastructure gap.

Looking at investments, the report observed that multinationals are increasingly deciding to quit Nigeria or reduce their presence.

It estimated that there was a net withdrawal of Foreign Direct Investments (FDI) in 2023, to be repeated in 2024 as naira losses exert pressure on balance sheets carrying large foreign liabilities.

“The exodus includes oil majors selling onshore assets, which are high-cost and vulnerable to insecurity, leading to the sector’s indigenisation over time. Although, in principle, this is positive for foreign exchange accumulation, local companies will be unable to match the investing power of outgoing multinationals,” the EIU argued.

The intelligence unit also predicted that Nigeria’s crude oil production will rise from 1.23 million bpd in 2023 to 1.48 million bpd in 2028, although this remains about 250,000 bpd below the 2019 level.

However, Nigeria hit 1.42 million bpd in January and from all indications, is expected to exceed that in the production February circle when the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) releases the output data.

===

In conjunction with the IMF/World Bank annual meetings, forecasts released at the July World Economic Outlook in July 2022, projected Nigeria inflation to fall to 17% and an increase in its Gross Domestic Product GDP, to 3.4% in 2022 and 3.2% in 2023.

Reprojected in October World Economic Outlook, Nigeria’s GDP is projected to drop to 3.2% in 2023 with a difference of 0.2% in the July 2022 projection.

The IMF estimates that by 2023, Nigeria’s inflation will have decreased to 17% from a projected 19%.

According to the African Development Bank Group (AFDB), Growth will slow, averaging 3.2% from 2022 to 2023 because of the continued low oil production and rising insecurity.

The conflict between Russia and Ukraine, rising food, gas, and diesel costs, and continuous supply disruptions are all anticipated to play a part in keeping inflation high in 2022 at 16.9% and above pre-pandemic levels in 2023.

While oil exports are anticipated to slightly increase and capital inflows to rebound, an expected positive oil price shock on exports may be substantially outweighed by a poor output effect caused by lower oil production, which is fueled by inadequate infrastructure and increased insecurity.

The anticipated 0.1% of GDP marginal current account surplus in 2022 could turn into a 0.2% deficit in 2023.

With greater revenue collection, the budget deficit will typically drop to 4.5% of GDP. Furthermore, it is predicted that by 2024, the government debt is expected to reach 40% of GDP due to new borrowing.

From the IMF’s Research Department, Daniel Leigh, the Divisional Chief indicated that the recent increase in the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN) as well as the global fall in the price of crude oil and food are the foundations for the reduced inflation rate forecasts for Nigeria. However, the IMF’s Pierre-Olivier Gourinchas, Director of Research, provided guidance to the CBN and its international counterparts on the selection of monetary policy instruments necessary to reduce inflation.

The IMF’s lower growth rate forecast for the global economy in 2023 was consistent with predictions for Nigeria’s GDP growth.

Projections on the global economic growth for 2022 was retained at 3.2%  whereas projected to decrease to 2.7% in 2023.
In a statement describing why it anticipates slower global growth, the International Monetary Fund (IMF) provided an explanation:

“The world economy continues to face steep challenges, shaped by the Russian invasion of Ukraine, a cost-of-living crisis caused by persistent and broadening inflation pressures, and the slowdown in China…”

Curbing Economic Crisis

According to Pierre-Olivier Gourinchas, fiscal policy should not conflict with the efforts of the monetary authorities because otherwise it will only prolong the existing inflation leading to a severe financial crisis. Fiscal policy should also focus on the most vulnerable groups and for a short-term period.

In addition, fiscal policy can aid economies in adjusting to more unpredictable situations by making investments in human capital, digitalization and green energy. Although, with this in place, economies can withstand unexpected future crises, yet he expressed sadness that policies do not follow these concepts.

About the Writer:

Emmanuel Otori has over 10 years of experience working with 100 start-ups and SMEs across Nigeria. He has worked on the Growth and Employment (GEM) Project of the World Bank, GiZ, Consulted for businesses at the Abuja Enterprise Agency, Novustack, Splitspot and NITDA. He is the Chief Executive Officer at Abuja Data School.