Amazon Web Services (AWS) recently announced it would accept naira payments, stirring Nigeria’s cloud market. However, local providers like Okra and Nobus Cloud see the move as more of a formality than a game-changer. For them, AWS’s shift offers little real advantage in a market that is increasingly worried about currency fluctuations.
“I don’t necessarily think it’s anything more than [a move by a big player],” said Fara Ashiru, CEO of Okra, which launched its cloud product, Nebula, in 2024. Ashiru argues that AWS’s naira payments simply convert dollar costs at the prevailing exchange rate, keeping the financial burden on businesses unchanged.
Local providers maintain that their pricing models offer more stability, mitigating risks tied to exchange rate volatility. “Our cost is still about 30-35% lower than what AWS charges,” said Stephen Okoye, COO of Nobus Cloud, emphasizing the affordability of local services.
The naira’s sharp devaluation in 2023 led to soaring cloud service costs for Nigerian businesses reliant on dollar pricing. This surge prompted many to switch to local providers offering naira-based billing, which proved more affordable for companies earning revenue in local currency.
Beyond pricing, local providers have highlighted that their approach is tailored towards the Nigerian market. “Why are we building products hosted in countries far from our customers? It’s about creating solutions for African businesses,” Ashiru added.
Data sovereignty is another significant factor. Nigeria’s 2019 National Cloud Computing Policy urges businesses and government agencies to prioritize local cloud services. The Central Bank of Nigeria also mandates that commercial banks host some customer data locally, further bolstering local providers.
In 2024, local providers began engaging with government agencies to host sensitive data. Some agencies have already started switching to local providers, though details remain confidential.
AWS faces not just local competitors but also global ones like Microsoft Azure and Huawei. Huawei launched its local cloud service in Nigeria in December 2024, quickly gaining traction. With a strong foothold in Nigeria’s banking sector, the Chinese tech giant secured a major deal with UBA for 200 petabytes of cloud storage valued at $3 million.
Local providers must now contend with AWS, Azure, and Huawei, all vying for dominance in Nigeria’s growing cloud market.
