Poor digital skills, talent shortages, and infrastructure deficiencies are limiting the adoption of Artificial Intelligence (AI) among Nigerian small and medium-sized enterprises (SMEs), according to Zoho Nigeria Country Head, Kehinde Ogundare.
Ogundare, in a statement issued on Tuesday titled, “The Future of AI in Nigerian SMEs: Overcoming Barriers to Implementation,” said findings from a study involving 144 Nigerian SMEs showed that limited digital literacy, unreliable electricity supply, poor broadband access, and high technology costs were preventing many businesses from fully harnessing AI. He noted that addressing these challenges is critical to improving productivity, competitiveness, and business growth.
According to Ogundare, while discussions around AI in advanced economies are largely centred on innovation, scale, and competitive advantage, many Nigerian SMEs remain preoccupied with rising operating costs, infrastructure challenges, and business survival.
He said global conversations on AI often overlook the realities confronting Nigerian businesses operating with unstable power supply, limited broadband access, and constrained financial resources.
“Micro, Small and Medium Enterprises (MSMEs) contributed 46.32 per cent to Nigeria’s Gross Domestic Product in 2024, accounting for 96.9 per cent of businesses and 87.9 per cent of employment. These businesses are the backbone of the economy, and any meaningful AI strategy for Nigeria must work within their daily operating conditions,” Ogundare said.
He explained that although awareness of AI is increasing among business owners, practical implementation remains difficult because many organisations lack access to affordable and appropriate technologies.
Ogundare said subscription-based technology models are helping to democratise access to AI by eliminating the need for substantial upfront investments and enabling businesses to pay only for the services they use.
He added that integrated platforms combining functions such as invoicing, customer relationship management, and inventory tracking could help businesses cut costs while improving operational visibility.
“Any technology adopted by SMEs must deliver measurable productivity gains and support profitability in an environment where margins are already under pressure,” he said.
The Zoho Nigeria Country Head identified infrastructure as one of the biggest obstacles to wider AI adoption, citing unreliable electricity supply, high data costs, and connectivity limitations.
He noted that many businesses now rely heavily on smartphones, making mobile-first AI solutions more suitable for Nigeria’s operating environment.
According to him, AI tools that depend on uninterrupted electricity or constant broadband access are unlikely to achieve widespread adoption among SMEs.
“The tools that will succeed are those that consume less data, work on mobile devices, and can function offline before synchronising when connectivity returns,” Ogundare said.
He also emphasised the importance of digital skills development, noting that recent studies indicate that 64 per cent of African workers are already using AI in their workplaces.
According to him, the finding reflects growing readiness for AI adoption across the continent and underscores the need for organisations to invest more in workforce training and upskilling.
Ogundare urged technology providers, policymakers, and business support organisations to prioritise affordable, low-bandwidth, and user-friendly AI solutions tailored to local realities.
“Low cost, low bandwidth requirements, and ease of use for non-technical users are not optional features; they are essential requirements for AI adoption in Nigeria’s SME sector,” he said.
