Lagos State has reaffirmed its position as the commercial heartbeat of Nigeria, accounting for 16% of all informal businesses nationwide — a figure that equals the combined total of the Northeast and Southeast regions, according to Moniepoint Microfinance Bank’s 2025 Informal Economy Report.
The report, which provides an in-depth analysis of Nigeria’s vibrant but largely unregulated informal sector, highlights Lagos as the undisputed hub of micro, small, and unregistered enterprises, driven by its dense population, thriving markets, and entrepreneurial culture.
According to Moniepoint, Lagos’s 16% share significantly outpaces other states such as Ogun, the Federal Capital Territory (FCT), and Delta, which each recorded 6% of the country’s total informal businesses.
In contrast, states including Taraba, Yobe, Kebbi, and Zamfara were identified as having the lowest participation, with just 1% each, reflecting the uneven distribution of informal economic activity across Nigeria’s regions.
The 2025 Informal Economy Report underscores the critical role of informal businesses — ranging from small traders and artisans to transport operators and service providers — in sustaining household incomes and driving local commerce.
Moniepoint noted that the informal sector remains a backbone of Nigeria’s economy, contributing significantly to employment and GDP, despite challenges such as limited access to finance, inadequate infrastructure, and low levels of digital inclusion.
“The dominance of Lagos in the informal business ecosystem is not surprising, given its economic size, urbanization rate, and the concentration of commercial activities,” the report stated. “However, there remains a need to extend financial inclusion and business support services to less active regions to achieve balanced economic growth.”
The findings come amid renewed efforts by both federal and state governments to formalize segments of the informal economy through policies that promote digital payments, taxation, and access to microcredit — measures expected to enhance productivity and improve revenue generation across the country.
