In Nigeria, high inflation is pushing citizens towards entrepreneurship as a survival tactic. A PiggyVest survey revealed that 31% of respondents prioritize business ventures as their savings goal, with many starting businesses not by choice but out of necessity due to rising costs. Women are becoming business owners at higher rates, leading to a shift in financial priorities focused on business and financial independence.
The ongoing inflation crisis in Nigeria is reshaping economic behavior, compelling individuals to explore entrepreneurship as a means of survival. A recent survey conducted by PiggyVest, which included insights from over 10,000 respondents, has revealed that 31 percent of Nigerians now view starting a business as their primary short-term savings goal. This shift, highlighted by Odunayo Eweniyi, indicates that many are becoming entrepreneurs driven by necessity rather than ambition due to the challenges of increased living costs and reduced purchasing power.
The survey gathered data from a diverse demographic, investigating the influence of inflation on income, savings, spending habits, and debt management among Nigerians. It was found that 31 percent consider launching or expanding a business as their second major short-term financial aim, with nearly one in four participants citing business-related ventures as a source of debt accumulation. Notably, 26 percent of individuals reported owning a business, with a higher percentage of ownership among women compared to men.
As Nigeria’s inflation reached a staggering 34.80 percent by the end of 2024, the pressure on purchasing power intensified, highlighting the need for additional income streams. The effects of soaring food prices, currency volatility, and excess liquidity have further exacerbated these inflationary challenges, straining both consumers and businesses.
Discussions on social media platforms mirror these economic strains, with many Nigerians acknowledging that entrepreneurship is often a necessity rather than a choice. One insightful comment noted, “Most Nigerians aren’t entrepreneurs by choice. It’s a necessity to supplement income from a job or if no job is available… We are hustling, not proper entrepreneurship.”
According to PWC, small to medium enterprises (SMEs) represent 96 percent of businesses and provide 84 percent of employment, contributing approximately 46.3 percent to the national GDP. PiggyVest’s findings indicate that women have a higher inclination towards business ownership, with many venturing into micro-businesses primarily for survival rather than growth. Commenting on this trend, Ibiyinka Ibru remarked that women’s business ownership often correlates with job exclusions related to family obligations.
Eweniyi noted that the insights from the survey are essential for guiding PiggyVest’s product development. Following last year’s notable interest in relocation savings (‘Japa’), PiggyVest adjusted its offerings to better assist users in achieving their travel aspirations. However, current economic conditions have shifted priorities towards business initiation and financial independence. Consequently, there has been an increase in interest rates for SafeLock, alongside the introduction of PiggyVest Business, a platform aimed at aiding users in managing business finances more effectively. This evolution reflects a growing focus on optimizing financial returns.
In conclusion, the rising inflation in Nigeria serves as a powerful catalyst for increased entrepreneurial efforts among its citizens, with many compelled to pursue business opportunities as a means of coping with economic hardships. Surveys indicate that starting or growing a business has become a crucial financial goal for a significant portion of the population. Moreover, the trend appears to disproportionately affect women, highlighting the complex dynamics of entrepreneurship in Nigeria. As economic conditions continue to evolve, so too do the financial priorities of the populace.
Original Source: businessday.ng
