Lagos is becoming not only Nigeria's megacity but also Africa's fintech capital. Despite rapid growth, the city faces significant infrastructure burdens.
Lagos' Fintech Dominance
According to StartupList Africa, Lagos hosts 503 active fintech startups. Since 2020, 256 new fintech entities have emerged, with 78 businesses now employing over 50 people, indicating a shift towards serious scale. Over this period, these startups secured $6.03 billion in funding.
Infrastructure Challenges in Lagos
Despite the optimistic outlook, Lagos' infrastructure faces serious issues. Frequent power outages and unreliable internet connections are significant concerns. More than 80% of households and businesses depend on generators. On average, tech-sector firms experience 30+ power cuts per month, each lasting 2-5 hours.
The Future of Fintech in Lagos
The future of fintech in Lagos will rely heavily on addressing infrastructure issues. If current weaknesses in power supply, internet connectivity, and logistics are not resolved, it could negatively impact the rapid growth of fintech in the region. Given the high costs of rent and commuting, many young professionals are reconsidering relocation to smaller cities.
Lagos showcases impressive growth rates in the fintech sector, yet infrastructure challenges raise doubts about its long-term sustainability. Significant efforts are needed to enhance business and living conditions in the city.
