As online trading reshapes Nigeria’s economy, stakeholders urge policies that protect consumers, improve accountability, and sustain growth without stifling innovation.

By ifeoma Onyekachi

Abuja, April 19, 2026- Experts have called for a balanced regulatory framework for Nigeria’s rapidly expanding online trading sector, warning that while digital commerce is transforming business operations and consumer behaviour, it also presents emerging risks that require urgent policy attention.

The call comes amid the continued growth of Nigeria’s digital marketplace, driven largely by increased smartphone penetration and widespread social media usage. The digital economy now contributes more than 19 per cent to the nation’s Gross Domestic Product (GDP).

This expansion, accelerated by behavioural shifts during the COVID-19 pandemic, has significantly altered consumer preferences, with more Nigerians opting for faster and more convenient online transactions. The trend has reshaped traditional shopping patterns and fueled the rapid rise of e-commerce nationwide.

The Director-General of the Nigerian Association of Small Scale Industrialists (NASSI), Chris Oputa, described the surge in online commerce as both a response to necessity and a reflection of global economic trends.

He attributed the growth to the widespread adoption of mobile devices, increased social media engagement, and evolving consumer demands. According to him, the momentum gained during pandemic lockdowns has persisted, as many Nigerians continue to embrace the cost-saving and convenience benefits of online trading.

“The habits formed during the pandemic have endured. Online trading reduces costs associated with transportation, rent, and other overheads, making it especially attractive to Micro, Small and Medium Enterprises (MSMEs),” Oputa said.

He added that eliminating the need for physical storefronts has lowered entry barriers for small businesses, thereby encouraging entrepreneurship.

However, Oputa cautioned that the sector’s rapid expansion has exposed critical gaps in regulation, data collection, and consumer protection.

He noted that the lack of reliable data on online transactions makes it difficult to accurately assess the sector’s economic impact, while the migration from physical markets to largely informal digital spaces has weakened government revenue generation through conventional levies.

“Many traders now operate remotely, making monitoring and taxation more challenging,” he said.

Oputa also raised concerns about fraud and anonymity in online transactions, warning that inadequate traceability creates opportunities for criminal activity.

To address these challenges, he proposed the establishment of a national verification system for online traders to improve accountability and build consumer trust. Under this system, verified vendors would be issued identification codes, while consumers would be encouraged to transact only with registered operators.

He further recommended the introduction of an insurance-backed compensation scheme for victims of online fraud, funded through contributions from registered traders.

Oputa also warned that poorly regulated cross-border e-commerce could undermine local industries by increasing imports and potentially leading to job losses.

Also speaking, a Senior Lecturer at Obafemi Awolowo University, Dr Nathaniel Oladunjoye, attributed the growth of online trading largely to Nigeria’s youthful population.

He noted that many young Nigerians engaged in remote or flexible work arrangements prefer the convenience of digital platforms, which allow transactions at any time.

“The increasing use of smartphones and internet-enabled devices has accelerated digital commerce. Many retailers now operate dedicated applications that enable seamless browsing, payment, and delivery,” he said.

With over 60 per cent of Nigeria’s population classified as youth, Oladunjoye projected sustained growth in the sector.

Unlike Oputa, he emphasised the advantages of online trading, describing it as efficient and accessible for both buyers and sellers.

“I see it as a positive development. It enhances convenience and accessibility,” he said.

On regulation, Oladunjoye agreed on the need for government oversight, particularly to ensure proper registration of digital platforms operating within Nigeria. He added that such measures could also expand government revenue through taxation.

He further stressed the importance of extending internet infrastructure to rural areas to ensure broader participation in the digital economy.

“Most internet infrastructure is concentrated in urban centres. Expanding access will integrate rural communities into online commerce,” he said.

Meanwhile, traders highlighted the cost-saving benefits of online platforms, noting that digital channels have expanded their market reach.

A Lagos-based fashion retailer, Adaeze Okorie, said she no longer requires a physical shop to run her business.

“Social media allows me to reach customers nationwide without the cost of maintaining a store,” she said.

Similarly, an Abuja-based gadget seller, Sadiq Musa, said online trading enables him to operate with minimal capital.

“I can run my business from home and still reach a wide customer base. It has significantly reduced my expenses,” he said.

However, Musa pointed to ongoing challenges, including fraudulent buyers, fake payment alerts, and order cancellations, which continue to affect sellers.

Consumers also shared mixed experiences. Esther James, a civil servant in Abuja, said online shopping saves time and transport costs, allowing her to conveniently order goods ranging from food to clothing.

In contrast, Gilbert Ezigbo cited concerns over product quality and seller accountability.

“Sometimes what you receive is different from what you ordered, and it can be difficult to trace the seller,” he said.

Stakeholders agreed that while online trading presents significant economic opportunities, there is a pressing need for policies that ensure consumer protection, enhance accountability, and mitigate risks.

They stressed that any regulatory framework must strike a careful balance between fostering innovation and safeguarding Nigeria’s evolving digital marketplace.