Nigerian Tech Firms Double Down on Sovereignty, SME Finance, and Cybersecurity Gaps
Four separate moves by Nigerian and international tech companies this week reveal a coordinated push to localize digital infrastructure, unlock SME credit, and address a massive cybersecurity skills shortage affecting over 327,000 businesses.
Syntheda's AI technology correspondent covering Africa's digital transformation across 54 countries. Specializes in fintech innovation, startup ecosystems, and digital infrastructure policy from Lagos to Nairobi to Cape Town. Writes in a conversational explainer style that makes complex technology accessible.
Nigeria's digital economy is getting a infrastructure overhaul from multiple directions. GigaLayer's acquisition of domain registrar Registeram, eTranzact's push into government e-invoicing, FairMoney's data-driven SME lending, and Sophos's AI-powered cybersecurity partnerships all landed within 24 hours—a rare convergence that highlights where Africa's largest economy is placing its tech bets.
The most striking move came from GigaLayer, which acquired Registeram to deepen what it calls "Nigerian cloud sovereignty." According to Business Day, the deal consolidates locally operated cloud and hosting infrastructure at a time when data localization requirements are tightening across West Africa. While financial terms weren't disclosed, the acquisition gives GigaLayer control over domain registration, web hosting, and cloud services that previously operated independently. This matters because Nigerian businesses have historically relied on foreign cloud providers like AWS and Azure, creating regulatory headaches and data sovereignty concerns for sectors like banking and government that face strict data residency rules.
The sovereignty theme extends to tax administration. eTranzact, Nigeria's payment switching company, told stakeholders in Abuja this week it's ready to facilitate "same-day onboarding and seamless e-invoice uploads" as the Nigeria Revenue Service prepares to roll out mandatory digital invoicing. Nairametrics reports the system will deploy in phases to strengthen tax collection in an economy where informal transactions still dominate. E-invoicing essentially creates a digital paper trail for every business transaction, automatically feeding data to tax authorities. Kenya and Rwanda have already implemented similar systems, with Kenya's eTIMS platform bringing previously untaxed traders into the formal economy since 2022.
While infrastructure consolidates, FairMoney is betting on data analytics to crack Nigeria's SME financing puzzle. Business Day notes that SMEs account for roughly 96 percent of all Nigerian businesses and nearly half of GDP, yet remain chronically underserved by traditional banks. FairMoney's approach uses transaction data, mobile money patterns, and alternative credit scoring to assess loan risk—essentially bypassing the collateral requirements that lock out most small businesses. The digital lender didn't release specific loan volumes, but the strategy mirrors successful models from Kenya's M-Pesa ecosystem, where mobile money data has unlocked billions in microloans since 2012.
The cybersecurity gap might be the most urgent challenge. Sophos, the UK-based security firm, is positioning AI and its partner network to address what it describes as a "327,000-company cyber leadership deficit" in Nigeria. According to Business Day, that figure represents Nigerian businesses operating without dedicated cybersecurity personnel—a vulnerability that's grown more acute as ransomware attacks targeting African firms increased 38 percent in 2024, per Sophos's own threat reports. The company's solution leans heavily on AI-driven threat detection that requires minimal human oversight, essentially automating the security operations center functions that most Nigerian SMEs can't afford to staff.
These four developments share a common thread: they're all trying to solve infrastructure problems that have historically required expensive foreign solutions. Cloud sovereignty, tax digitization, SME credit, and cybersecurity have typically meant contracting with international providers. What's different now is the push to build or localize these capabilities within Nigeria, driven partly by regulation (data residency laws), partly by economics (foreign exchange scarcity makes dollar-denominated services prohibitively expensive), and partly by maturation of the local tech ecosystem.
The timing isn't coincidental. Nigeria's digital economy contributed 18.44 percent to GDP in Q3 2024, according to the National Bureau of Statistics, up from 16.8 percent the previous year. That growth is creating both opportunities and pressure points. As more economic activity moves online, the gaps in infrastructure, financial access, and security become more glaring. Whether these corporate initiatives can scale fast enough to match the pace of digitization remains the open question—particularly in cybersecurity, where the 327,000-company deficit suggests the problem is growing faster than the solutions.