BY :Ogundana Boluwatife
Nigeria has millions of potential customers for digital payments, ride-hailing, online services and financial technology. Yet, in 2026, several technology businesses have shut down, withdrawn from specific services or ended their Nigerian operations.
The developments raise an important question: if Nigeria offers such a large market for technology companies, why are some struggling to make their businesses work?
A BusinessDay report published on October 21 identified five technology businesses that had retreated from Nigeria or discontinued major operations during the first ten months of 2026: Uber, Moove, Gigbanc, Chimoney and Onafriq’s Baxi agent-banking business.
Their decisions were not identical. Uber ended its Nigerian ride-hailing operations, Moove wound down its Nigerian business, Gigbanc discontinued its services, Chimoney halted new transactions before being acquired, and Onafriq withdrew from agent banking while retaining other operations in Nigeria.
Together, these developments reveal the difference between having millions of potential customers and running a business that can generate sustainable returns.
When a Large Market Is Not Enough
Nigeria’s population and demand for digital services make it attractive to technology investors. However, businesses must still cover the cost of providing those services.
For a ride-hailing company, that means balancing affordable fares with drivers’ earnings, fuel, vehicle maintenance and other expenses. For a fintech company, it includes technology infrastructure, regulatory compliance, customer support and security.
Currency movements can add another challenge. A company that earns revenue in naira but pays some technology or infrastructure costs in dollars may find its expenses rising when the naira weakens.
Inflation can also increase staff salaries, office expenses and other operating costs. Meanwhile, customers facing pressure on their budgets may be unwilling or unable to pay higher prices.
The result is a difficult equation: companies need enough revenue to sustain their operations, but raising prices can make their services less affordable.
Uber and Moove: The Cost of Moving People
Uber discontinued its Nigerian ride-hailing operations on September 2, 2026, after approximately 12 years in the market. Moove, a Nigerian-founded vehicle-financing company that worked with ride-hailing drivers, subsequently announced plans to wind down its Nigerian operations.
The developments exposed the relationship between different businesses within the mobility industry.
Ride-hailing platforms depend on sufficient passenger demand, while drivers must earn enough to cover fuel, maintenance, insurance and, where applicable, vehicle-financing payments. Vehicle-financing businesses also depend on those vehicles generating sufficient revenue.
If the underlying economics become difficult to sustain, the consequences can extend beyond the platform itself to drivers and other businesses connected to its operations.
Nairametrics reported on October 17 that rising vehicle costs, financing obligations and pressure on passenger affordability were making the ride-hailing business increasingly difficult to sustain.
However, Uber’s exit does not mean Nigerians have stopped needing ride-hailing services. It raises a different question: can the remaining operators serve that demand while keeping fares affordable and providing sustainable earnings for drivers?
Fintech Businesses Face Their Own Challenges
The pressures extend beyond transportation.
Gigbanc announced plans to wind down its services in July 2026 after struggling to secure sufficient funding to continue operating. Chimoney, which provided cross-border payments infrastructure, halted new transactions and integrations from May before being acquired by CapitalSage Vantage in October.
These cases highlight why transaction volume and customer interest do not automatically translate into profitability.
A fintech business may process substantial payments but still struggle if the revenue earned from each transaction cannot cover its technology, staffing, security and compliance expenses.
Funding is also important. Startups often require capital to develop products, attract customers and expand before their businesses become profitable. When fundraising slows, a company with high operating expenses may have limited time to find a sustainable model.
An acquisition, such as Chimoney’s, can provide another route for a business or its technology to continue under new ownership. It is different from a company simply shutting down without a successor.
Baxi Shows How Competition Can Change a Business
Onafriq announced in October that it would close its Baxi agent-banking operations in Nigeria.
The company attributed its decision to rising operating costs, inflation, naira depreciation and increasing competition. It also pointed to changes in payment behaviour, including the growing use of instant bank-to-bank transfers.
Agent banking relies on physical outlets where customers can carry out transactions. Operating such a network involves costs associated with technology, distribution, cash availability and support for agents.
When transaction patterns change or expenses rise faster than revenue, maintaining a large network can become harder to justify.
Importantly, Onafriq is not leaving Nigeria altogether. It plans to retain its broader payments and card-issuing operations. Its decision therefore represents a retreat from one business line, rather than a complete withdrawal from the country.
What Happens to Customers and Workers?
When a technology company withdraws from a market, the effects can extend to employees, customers, agents, drivers and partner businesses.
Customers may need to find alternative services. Drivers may move to competing platforms, while agents may have to transfer their activities to other payment providers. Employees may face job losses or seek new opportunities.
Competitors can also benefit by attracting customers and workers who previously used the departing company’s services.
But these opportunities do not guarantee that the remaining businesses will become profitable. They must still manage their costs, maintain service quality and offer products that customers can afford.
The longer-term impact will depend on how well competitors respond and whether customers have suitable alternatives.
What Would Make Nigeria More Attractive to Tech Businesses?
The recent withdrawals do not establish that Nigeria’s technology sector is failing. They show that businesses operating in the country must contend with economic and commercial realities that can undermine even promising ideas.
More predictable operating costs, reliable infrastructure, access to sustainable financing and clearer regulation could help businesses plan for the long term.
Consumer purchasing power also matters. A company may attract many users with low prices, but it still needs a viable way to cover the cost of serving them.
Investors and founders must also assess whether their business models fit the market rather than assuming that a large population will automatically deliver profits.
The Bottom Line
Nigeria remains a significant market for digital services, but the experience of Uber, Moove, Gigbanc, Chimoney and Baxi demonstrates that demand alone is not enough.
Technology businesses must find a way to convert customer demand into reliable revenue while managing operating expenses, currency exposure and competition.
For Nigeria, the challenge is not simply attracting more technology companies. It is creating conditions in which businesses can survive, expand and continue serving customers over time.
Sources
- BusinessDay — Five tech businesses retreat in first 10 months of 2026
- Nairametrics — Why Nigeria’s ride-hailing business is becoming harder to sustain
- Legit.ng — Baxi closes its agent-banking operations in Nigeria
Reporting note: Before publication, seek comments from affected drivers or agents, competing technology companies and industry analysts. This will add firsthand evidence to the analysis of why these businesses withdrew.
