Despite the vast opportunities that internet access and technology offer small businesses in Africa, less than seven percent of micro‑enterprises actually use digital tools for their operations, according to new research by the International Finance Corporation (IFC) and the World Bank. The report, released on Thursday, draws on data from a survey of 3,325 micro‑enterprises across seven countries—Ghana, Kenya, Mozambique, Nigeria, Senegal, South Africa, and Tanzania. Respondents who employed smartphones and computers reported productivity levels 2.8 times higher, sales six times greater, and a workforce 1.9 times larger than those who did not use such technologies.
The survey also revealed that 71 percent of participants saw “no need” for digital technologies. Cost was a major barrier: 35 percent said the expense of purchasing devices, monthly usage fees, and electricity made technology unaffordable. An almost equal share, 34 percent, lacked the skills to use these tools, highlighting a digital‑skills gap.
Access to high‑speed internet was another factor. Twenty percent of respondents cited its unavailability as a reason for not adopting digital solutions. While mobile and high‑speed internet penetration among the general population in Sub‑Saharan Africa averages 22 percent—more than three times the rate among micro‑enterprises—only 20 percent of businesses reported using it. High‑speed internet coverage has risen from 25 percent in 2010 to 84 percent in 2021, yet connectivity has not kept pace: as of 2021, 74 percent of Africans living in areas with high‑speed mobile internet remained unconnected.
Limited access to micro‑financing further constrained technology adoption. Only three percent of surveyed firms had previously received a loan, and those that did were 18 percentage points more likely to use a smartphone. Infrastructure deficiencies also posed challenges: 44 percent of firms—and 69 percent of agribusinesses—lacked electricity. Moreover, micro‑enterprises were largely isolated from international supply chains, with just 16 percent relying on a large company as a primary supplier and fewer than two percent having major foreign‑based suppliers. Strengthening these links could provide digital learning opportunities and integrate small businesses into larger supply networks.
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