The informal economy accounts for more than 80 per cent of Africa’s total workforce, creating significant broadband deployment challenges and opportunities across the continent, according to a study by market research firm Omdia.

The newly published study, titled Broadband and the Informal Economy in Africa, defines this vast informal economy segment as encompassing all economic activities by workers and economic units that are, in law or in practice, not covered or insufficiently covered by formal arrangements.

The research notes that these unregulated economic activities often thrive in environments characterised by high unemployment, widespread underemployment, poverty, persistent gender inequality, and precarious working conditions.

This immense scale presents significant structural hurdles for digital transformation efforts spearheaded by both private service providers and regional government agencies.

Traditional broadband deployment and fixed billing structures often completely fail to address the unique connectivity needs and fluctuating financial circumstances of informal sector workers and small businesses.

However, the analytical findings reveal how mobile broadband networks and innovative prepaid fibre solutions are rapidly gaining ground as viable connectivity options in this highly complex market landscape.

“Africa’s informal economy represents both a challenge and an opportunity for broadband expansion,” said principal analyst at Omdia Thecla Mbongue.

“Understanding the specific connectivity requirements and payment preferences of this demographic is essential for successful digital inclusion,” Mbongue added.

The industry publication provides a detailed, comprehensive analysis of the broadband infrastructure challenges that are specific to informal economy environments across different African territories.

The content explores the rapid rise of mobile broadband as a highly flexible connectivity solution for merchants and transient laborers.

The analysis also covers smartphone usage trends alongside the emergence of various device financing options designed to lower the barrier to entry for low-income consumers.

Furthermore, the document evaluates prepaid fibre business models that successfully accommodate irregular income patterns by eliminating long-term contractual commitments.

The report highlights critical policy considerations for governments seeking to expand digital access and improve public service delivery to unregistered entities.

Finally, the text outlines strategic recommendations for service providers targeting informal sector customers to help operators design sustainable commercial packages.

As diverse digital services become increasingly essential for daily economic participation, bridging the persistent connectivity gap in Africa’s informal economy will be absolutely crucial for inclusive growth and development across the continent.