From government initiatives to startup innovation, discover how Nigeria’s unique approach to AI adoption positions it as Africa’s next digital powerhouse—while confronting infrastructure, talent, and regulatory challenges.
A recent PwC report shows that by 2030, the contribution of Artificial Intelligence (AI) to the global economy is likely to reach $15.7 trillion. Going forward, AI is likely to transform industries, economies, and enhance productivity, and greatly revolutionize the world by fostering innovation.
In today’s digital age, businesses and entrepreneurs are swamped with vast volumes of data generated from diverse sources, including transactional systems, customer interactions, Internet of Things (IoT) devices, and social media. Often known as “Big Data”, this flood of information can be both chaotic and overwhelming. However, when big data is harnessed effectively and combined with Artificial Intelligence (AI), this chaos can be transformed into structured insights that drive innovation, boost efficiency, and give businesses a significant competitive edge.
Already, the AI revolution is here. Today, AI is not just an additional tool but a powerful force that is transforming business operations, models, and decision-making. Enterprises that lag in AI adaptation face operational inefficiencies, workforce resistance, and miss out on competitive advantages.
1. The Growth of AI in Africa
In Africa, Artificial Intelligence is no longer just another imported tech curiosity. Today, AI is an engine of change, transforming even the remotest of villages. In 2025, the entire spend on AI is estimated at between $2 and 3 billion. This might only be about between 1 and 1.5% of the global spending, but according to projections, by 2030, AI could potentially inject a whopping $1.5 trillion into Africa’s gross domestic product (GDP).
2. Understanding AI-Driven Disruption
Artificial Intelligence is rewriting and revolutionizing the rules of business. It is reshaping entire industries by redefining job roles and transforming workflows. But AI adaptation comes with a catch. Unless enterprises adopt the right change management strategy, AI, instead of giving a competitive edge, could trigger chaos. Rushing into AI-driven transformation may cause enterprises to experience internal pushback and lead to poor execution. Organizations should introduce AI automation in a strategic and controlled manner lest the pace outstrip a team’s ability to change and adapt.
While traditional AI has for many years driven progress in automation, data analysis, and predictive modelling, the advent of generative artificial intelligence (GenAI) is regarded as an important step towards the democratization of technology. GenAI eliminates the need for specialized expertise, thus enabling a broader range of users to access its powerful tools through natural language (NL) interaction.
Today, international organizations and brands that leverage AI have gained a competitive edge over those that delay or lag in their adoption. For example, in the financial sector, giants like JP Morgan and Goldman Sachs leverage AI to streamline operations and refine their financial analysis. In the education sector, Pearson has integrated AI into its educational products, transforming learning experiences. Recently, Telstra committed $700 million and signed a partnership with Accenture geared to fast-tracking AI integration.
These are only a few examples that underscore the urgent need for enterprises to integrate AI and also manage the transformation in a controlled and effective manner.
3. AI Adoption in Nigeria: The Current Landscape
Driven by the growing acknowledgement of AI’s transformative potential, Nigerian policymakers, researchers, investors, and entrepreneurs are exploring how emerging intelligent technologies can be leveraged to drive inclusiveness and address local challenges. In Africa, Nigeria competes closely with Egypt, South Africa, and Kenya when it comes to AI adoption and use. Nigeria, according to the 2023 AI Readiness Index, comes third after South Africa and Kenya in AI adoption and use. However, the country is rapidly narrowing the gap, particularly in terms of mobile AI applications.
As the continent’s largest economy and also the most populous nation in Africa, Nigeria has seen remarkable growth in AI adoption in different industries and sectors. The AI ecosystem in the country is dynamic and reaches a diverse blend of actors that include startups, established companies, learning institutions, and a host of innovative government initiatives. The goal is to tap AI to develop solutions for local challenges.
For example, the Nigerian government has initiated several steps to support AI technology capacity-building and innovation. The Nigerian Artificial Intelligence Research Scheme (NAIRS) and the National Centre for Artificial Intelligence and Robotics (NCAIR) were set up to support infrastructure development, provide technical and funding support for the country’s AI-driven projects. In addition, the National AI Strategy document lays the framework for Nigeria’s vision as the country seeks to leverage AI in enhancing social inclusion and economic competitiveness. The National AI strategy also seeks to position Nigeria as a technological innovation leader in Africa.
But it’s also important to be candid about AI adoption in Nigeria. While global giants are investing billions in AI research and implementation, many Nigerian businesses are still grappling with basic challenges and foundational gaps. These include fragmented data, legacy systems, and a dearth of advanced technical skills, compounded by a growing case of brain drain. However, the situation is not without opportunity, as many countries have overcome these hurdles and leveraged the benefits of early AI adoption.
4. Case Study: Nigerian Companies Leveraging AI for Strategic Advantage
The private sector in Nigeria, particularly startups, is a driving force in the AI ecosystem. Startups play an important role in fostering Nigeria’s economic growth, in poverty reduction, and job creation. The number of AI-focused startups in Nigeria has grown to over 80 from about 35 between 2022 and 2024. These are primarily concentrated in Abuja, Lagos, and Port Harcourt.
Collectively, over this 2-year period, these startups have raised more than $120 million in funding, signaling growth of investor confidence in the country’s AI potential.
From healthcare to payment systems and agriculture to logistics, local innovators in Nigeria are deploying AI-powered solutions to optimize operations, improve service delivery, and enhance decision-making. Several Nigerian startups and businesses have recorded remarkable success with AI adoption and implementations. These include the following four.
i. Flutterwave
A fintech startup founded in 2016 by Olugbenga Agboola and Iyinoluwa Aboyeji, Flutterwave provides seamless payment and business loan solutions. For businesses in Africa, Flutterwave facilitates cross-border transactions, enabling them to make and accept payments in local currencies. The Flutterwave platform is suitable for startups, established enterprises, and emerging markets.
Flutterwave leverages AI for various functions such as enhancing fraud detection and improving customer support through chatbots. To monitor and analyze payment transactions, the company has integrated machine learning (ML) algorithms that identify and flag suspicious activities, a critical aspect in fintech operations. Additionally, AI has helped the startup reduce operational costs, enabling the company to reinvest savings into expansion and further technology development.
ii. Helium Health
Helium Health was founded by three entrepreneurs, Adegoke Olubusi, Tito Ovia Dimeji Sofowora in 2016. Today, it is one of the most prominent digital health platforms on the African continent. Although it is headquartered in Nigeria, the health tech company now operates in seven other countries, including Kenya, Uganda, Ghana, Cameroon, Liberia, and Senegal.
In Nigeria, Helium Health leverages AI in healthcare to enhance patient care and management. The company uses AI for tasks like resource allocation, disease prediction, and telemedicine (remote consultations) in underserved areas. Today, Helium Health enables over 7,000 medical professionals and health to serve patients better and has facilitated over 300,000 monthly patient visits.
iii. Kobo360
Founded in 2018, Kobo360 is a logistics and supply chain technology startup. Kobo360 seeks to achieve its objective through the creation of a platform that connects manufacturers and buyers (cargo owners) with truck operators to help move goods seamlessly.
Kobo360 leverages data analytics and AI to improve efficiency and optimize operations within its platform in several ways. For example, AI is used to predict demand, match cargo with trucks, and optimize routes. This helps reduce costs for both truck owners and cargo owners as it leads to more reliable and faster deliveries. The platform leverages predictive analysis to provide businesses with valuable insights that will enable more informed decisions. This boosts productivity and improves customer experience.
iv. 54gene
54gene was founded in 2019. This healthtech startup focuses on advancing Africa’s healthcare through genomics research. The goal is to unlock African populations’ genetic diversity and improve medical research. This will help develop solutions that are tailored to specific health challenges facing the continent. The cutting-edge genomics work undertaken by 54gene has positioned the startup as a leader in the region’s healthtech space.
AI is key to 54gene’s operations, particularly when it comes to data processing. Machine learning (ML) algorithms are used to analyze genetic sequences, allowing for more precise disease marker identification and tailored treatment recommendations. AI has also enabled the Nigerian startup to scale its genome research activities as it helps in the rapid processing of data gathered from vast volumes of samples.
5. Nigerian Government AI Initiatives
In collaboration with the Gates Foundation, the Federal Ministry of Communications, Innovation & Digital Economy has launched the Nigeria Artificial Intelligence (AI) Scaling Hub. This initiative seeks to accelerate the scaling up of AI-driven solutions. It supports responsible AI development across key sectors such as education, health, and agriculture.
The Gates Foundation has committed up to $7.5 million to the Nigeria Scaling Hub over three years. The AI Scaling Hub initiative will advance Nigeria’s position as an example of Africa’s emerging technology hubs.
6. Broader Implications for Nigerian Businesses
Many organizations in Africa fail to manage disruption because of the existence of rigid strategic plans that often tend to become obsolete quickly. Besides ushering in a technological shift, AI in Nigeria offers a strategic opportunity to transform public services and accelerate inclusive growth as well as cement Nigeria’s position as a tech leader on the continent.
As AI models mature across different industries and sectors within the Nigerian economy, it opens possibilities for business leaders to transform their operations and bottom line. For Nigerian businesses and entrepreneurs, AI can improve decision-making, enhance operational efficiency, and boost productivity. In particular, Nigerian businesses can greatly benefit from recent generative artificial intelligence (GenAI) developments and faster computation power to leapfrog many other countries that are slow to transform and adapt AI technology.
7. Challenges and Opportunities of AI Adoption in Nigeria
Adopting AI comes with its fair share of challenges and hurdles to overcome, as well as numerous opportunities. However, experience elsewhere, particularly in Asia, has shown that with the right approach, it’s possible to overcome the risks and challenges presented by AI adoption. Infrastructure limitations, talent shortages, brain drain, funding gaps, data privacy concerns, and weak legal frameworks are just some of the challenges Nigeria faces as it seeks to adopt AI.
I. Infrastructure Deficiencies
To be of maximum benefit, AI technologies require high-speed internet, cloud computing capabilities, data storage, and a robust digital infrastructure. Unfortunately, these are still deficient or underdeveloped in many parts of Nigeria. Particularly in rural areas, limited access to reliable and fast internet services makes it difficult for companies and startups to deploy or implement AI solutions that require real-time connectivity and data processing.
II. Shortage of AI Professionals
Developing and implementing AI systems requires expertise in different areas such as data engineering, ML algorithms, and model optimization. Many of these technical skills are in short supply locally. Matters are aggravated by the increased emigration of trained professionals to other countries, which has created a gaping talent vacuum. While efforts are ongoing to bridge this talent gap through training initiatives and educational programs, the pace has been slow. Nigeria’s tech-savvy, young population, with a median age 1of 8.1 years, represents an opportunity as it has a large percentage of eager technology adopters and developers. In addition, initiatives like the Three Million Technical Talent (3MTT) program by the Federal Ministry of Communication and Digital Economy, Microsoft AI Skill Navigator, as well as other programs, are expected to support the growth of AI talents and help address the skills gap in Nigeria.
III. Funding Gaps
To fund research and development (R&D) and AI scaling, many early-stage startups often struggle to raise adequate capital. Most startups in the country, according to a report by the Nigeria Startup Ecosystem, still heavily rely on external funding sources such as grants and venture capital to finance R&D and AI projects. It goes without saying that with adequate funding, the rate of AI adoption will remain a dream for many Nigerian startups.
There is still hope, however, as major global firms are still betting on the continent’s AI potential. For instance, Google continues to commit resources towards the development and adoption of AI in Africa, including $5.8 million for training AI researchers and engineers.
IV. Weak Legal Frameworks and Standards
Nigeria’s AI landscape lacks robust regulation and legal frameworks. The existing AI regulations are fragmented across several regulatory bodies and agencies, which has led to overlap, confusion, and a general lack of cohesion creating many loopholes for misuse.
The success of AI initiatives increases with the development and implementation of AI-specific guidelines and standards. This also encourages an environment of sustainable shift toward new technologies in emerging markets. The National Artificial Intelligence Strategy was launched in 2023 to meet this challenge. Run and implemented by the National Information Technology Development Agency (NITDA) the strategy outlines Nigeria’s roadmap in AI adoption.
V. Data Privacy Concerns
The issue of data privacy is critical as AI systems rely on vast amounts of data, which often includes sensitive personal information. This highlights the need to ensure that the data is safeguarded. To mitigate these data privacy concerns, the government has established the Nigeria Data Protection Regulation (NDPR). This provides guidelines for personal data collection, storage, and processing.
8. Conclusion
In today’s world, disruption is the new normal. Whether the disruption is caused by shifting consumer expectations, global pandemics, geopolitical uncertainty, or rapid technological advancements, disruption is now a constant that businesses cannot afford to ignore if they are to survive and remain profitable.
The world is undeniably in a transformative era that is driven by AI with profound and far-reaching implications for companies and countries. Nigeria finds itself at a critical inflection point in its AI adoption journey. While the country has made significant steps, challenges remain.
For the country to realize the full potential of AI, it must make concerted efforts to address infrastructure gaps, invest in local talent, and implement appropriate regulatory frameworks. With the combination of increased investment, growing government support, and entrepreneurial energy, the future of AI in Nigeria is on a promising trajectory.
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Written by : Sammy Mwatha, Expert Author
Sammy Mwatha is a skilled content writer who blends business, tech, health, and lifestyle topics with analytical, story-driven insights.
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