Major policy successes for Nigeria’s IT sector were achieved in 2023, although improvements may come the following year.

The year 2023 was exceptional for Nigeria’s technology sector. In spite of the reduction in venture capital financing, job losses, and closure of certain firms, the ecosystem achieved several significant policy victories. New policies that foster innovation and startups were introduced. Another degree of validation was brought about by the federal cabinet’s selection of a member of the tech ecosystem. This presents a path of unanticipated difficulties as well as opportunities for the upcoming year.

Nigeria was the first nation in Africa to enact open banking laws in March, enabling banks to exchange client information with fintech and mobile money companies, among other third-party service providers. Customers would now have more control over their data thanks to this shift, which also promised increased data sharing and innovation. A proposed plan by Nigeria’s Central Bank to centralise open banking operations through the National Inter-Bank Settlement System (NIBSS) tempered the early euphoria, though. The decision was eventually reversed by the apex bank due to opposition from industry players.

Additionally in March, Osun state gained notoriety when it eliminated right-of-way costs, enabling internet and telecom service providers to install fibre optic cables at no cost. The purpose of the action was to entice startups to locate in the state. Plans to domesticate the Nigerian Startup Act were also revealed by Osun. In order to encourage innovation and entrepreneurship in the digital, technology, and creative industries, the Nigerian government also established a $618 million fund under the Investment in Digital and Creative Enterprises (iDICE) initiative.

A surprise arrival to May occurred when the Central Bank of Nigeria cancelled the licences of over a hundred financial institutions nationwide due to non-compliance. The digital bank Eyowo, operated by Softcom, is among the impacted banks. Another noteworthy event that occurred in May was the last-ditch effort to change the Nigeria Startup Act, which had previously been approved, by former minister of communications and digital economy of Nigeria Isa Ali Pantami, only days before the term of former President Muhammadu Buhari came to an end. In a similar vein, a contentious bill that aims to give the National Information Technology Development Agency (NITDA), Nigeria’s information and technology regulating agency, additional authority, passed a Senate public hearing in spite of opposition from interested parties.

The Nigeria Data Protection Bill 2023 was signed into law by President Bola Tinubu in June. A legislative framework for safeguarding and controlling personal data in the nation is provided by the new law. Another event is that the central bank published new guidelines that permit recipients of diaspora remittances to receive payments in naira, subsequent to the unification of the exchange rate. Fintechs and conventional banks now have more potential as a result of the shift. On the other hand, Nigerian startups’ reporting of revenue to international investors was impacted by the new foreign exchange policy.

Nigeria’s minister of communications, innovation, and digital economy, Bosun Tijani, is the co-founder of CCHub, one of the most significant tech incubators on the continent. He was appointed to this position in August. His appointment gave Nigeria’s expanding digital ecosystem, which now has a seat at the table, fresh hope. The minister formally announced his intentions to train three million technical talent in four years in October. The Nigerian Data Protection Commission (NDPC) opened an investigation into OPay, Meta, and DHL that same month for suspected breaches of data privacy, which the businesses refuted.

The minister announced the start of the pilot programme for the massive initiative to train 3 million technical skills in November. In three months, 30,000 people will have received training. Thirteen months after the Startup Act was ratified, the Nigerian government debuted its Startup Support and Engagement Portal in the same month. The portal would make it easier to register angel investors, venture capitalists, accelerators, incubators, and innovation hubs as well as to label Nigerian startups. Tax incentives, financial resource access, fund management, and cooperation with pertinent government agencies are further advantages. The Central Bank of Nigeria lifted a two-year ban on cryptocurrency transactions in December, but they also instituted stricter regulations for financial institutions.

In the end, Nigeria’s tech industry saw highs and lows in terms of regulations in 2023. It is evident that the ecosystem will depend on one of its own to advocate for laws and initiatives that will promote its expansion. More significantly, it makes perfect sense to work with and interact with the government.