Several Nigerian banks began limiting how much customers could spend on international transactions using their naira cards in 2022. This is largely because of the difficulty in obtaining the foreign exchange required to facilitate these transactions.
Immediately after the new president’s inauguration mid 2023, the situation escalated as the Central Bank announced its decision to float our Naira, therefore aggravating the challenges faced by businesses. This can also be said that the naira has lost much of its value against the dollar.
According to Bloomberg, it has lost almost 60% of its value in 2023 and was the worst-performing currency globally behind the Lebanese pound and Argentine peso.
As the naira has lost its value against the dollar, businesses are experiencing an higher operational cost of using digital products such as Notion, Slack, Google Workspace, Amazon Web Services, and Azure for project management, database storage, and communications. And majority of these products are developed by non-African entities, their pricing is typically quoted in dollars.
These has led many seeking alternatives especially locally and ensuring they charge in Naira. Although, many of the services are needed which results in use of foreign products therefore having a high impact on the cost implication. An example is the cloud hosting and infrastructure which are hosted on Amazon Web Services (AWS).
Oluwarotimi Owolabi who is a Backend & DevOps engineer made a comment on installing OS, DB, and Web Servers, configured monitoring & load balancing, and also building all kinds of local-Onprem servers, because it is usually the practice for private cloud users unlike all paid for automated AWS, Azure and Oracle servers which costs some heavy funds monthly and also may become unbearable with the uncontrolled exchange rate increase.
Building a Linode of Digital Ocean instance can also be used to host platforms which may seem like returning to old times but is needed for local tech businesses survival.
