Fintech Projects: Nigeria’s Informal Cross Border Payment Flows

For an American startup, we crafted a market entry strategy for a digital payments solution.

The Problem: Little or no research has been conducted to measure Nigeria’s informal cross border payment flows – whether by merchants and traders, or by economic migrants from neighbouring countries. Official statistics capture only the formal economy, rendering a skewed vision of key payment corridors and markets. Where, and, how do we begin to identify and prioritize key corridors for piloting a digital cross border payment solution?

Desk Research and Literature Analysis: In order to evaluate the market opportunity for digital cross border payments, and identify key geographies, we conducted an extensive search for literature on a wide ranging number of topics, going back twenty years. The search included papers on urban planning, border trade, markets and value chains, migration patterns, as well as grey literature and newspaper articles, in order to piece together an assessment of Nigeria’s economic relationship with her neighbours in the parallel market. This was supported by key informant interviews enabled by our extensive pan African network.

The Solution: After research, and analysis of available data, triangulating findings across disciplines, we identified and prioritized target customer segments, as well as geographical markets, for our client’s pilot market entry strategy. Our recommendations included possible customer pain points for validation by field research, and identified possible trade and remittance networks for partnering and collaboration. Our analysis covered regulatory and policy issues.

Our client has begun implementing our key recommendations in cooperation with our West African local partner.

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