Only 1.3% of Nigerian Informal Businesses Earn Over ₦2.5 Million Monthly Profit: Report

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A new report reveals that only 1.3% of Nigerian informal businesses achieve monthly profits exceeding ₦2.5 million. According to the Informal Economy Report 2024 by Moniepoint, while these unregistered businesses contribute significantly to Nigeria’s GDP, their actual profits are much lower than their revenue figures suggest.

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Launched on Friday in Abuja, the report highlights that 72.3% of informal businesses generate over ₦1 million in monthly revenue. Despite this, most of these businesses make less than ₦250,000 in profit each month.

The report also states that informal businesses contribute over half of Nigeria’s GDP. Retail and General Trade lead the informal economy, making up 24% of all businesses, followed by sectors such as Food & Drinks, Fashion and Beauty, and Agriculture, which together account for 58.6% of informal businesses in Nigeria.

A significant portion of the income for these businesses (68.2%) is spent on feeding and family expenses, while 29.7% is reinvested into the business. Access to credit remains a challenge, with 70.1% of businesses having accessed credit primarily from friends and family (70.7%), loan apps/platforms (15.1%), and traditional banks (12.2%).

Contrary to the belief that informal businesses evade taxes, the report shows that nearly 90% pay some form of tax, mainly market levies, with 65.1% paying these levies regularly, underscoring their contribution to national revenue.

Godwin Okafor, The Naija247news
Godwin Okafor, The Naija247newshttps://naija247news.com
Godwin Okafor is a veteran Financial Journalist, Internet Social Entrepreneur, and the visionary Founder of Naija247news Media Limited. With an extensive career spanning over 16 years in financial journalism, Godwin possesses a wealth of experience that seamlessly bridges both traditional and digital media landscapes. His journey in journalism commenced at Business Day, Nigeria, where he laid the foundation for his prolific career. In 2010, Godwin took a bold step by founding Naija247news Media, a platform that has since become a prominent player in delivering timely and accurate news. Educationally, Godwin Okafor holds a Bachelor's degree in Industrial Relations and Personnel Management from the prestigious Lagos State University, Ojo, Lagos. His commitment to continuous learning led him to the Lagos Business School, where he further honed his skills. Additionally, he is recognized as a Fellow of the University of Pennsylvania, having successfully completed the Wharton Seminar for Business Journalists. Throughout his illustrious career, Godwin has earned acclaim by winning numerous journalism awards, a testament to his dedication to excellence in reporting. Beyond his role as a Financial Journalist, Godwin Okafor wears the hat of the Chairman at Emmerich Resources Limited, the publishing entity behind Naija247news. His visionary leadership has played a pivotal role in shaping the media landscape and establishing Naija247news as a trusted source of information. Godwin Okafor's multifaceted expertise, commitment to journalistic integrity, and leadership in the realm of business journalism underscore his influential presence in both the media and entrepreneurial spheres.

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