Nigeria’s tax authority has for decades depended on companies to report sales months after transactions occurred. It is now moving toward a system designed to monitor business activity in real time.

Under a nationwide electronic invoicing programme, every qualifying invoice—a commercial invoice that satisfies all statutory requirements set by a tax authority—will be transmitted digitally to the Nigeria Revenue Service (NRS) at the point it is issued. The initiative is one of Nigeria’s most ambitious efforts to modernise tax collection and expand the infrastructure of its digital economy. It comes as Africa’s largest economy by GDP continues to grapple with a tax-to-GDP ratio of roughly 10–11%, among the lowest for major economies worldwide, underscoring the fiscal pressure driving structural reform.

The government is developing a national platform that could eventually link every business, enterprise resource planning (ERP) system and accounting software provider to a single tax network.

The timeline is already under way. Large taxpayers are under compliance monitoring, while medium-sized businesses are scheduled to begin mandatory onboarding in July 2026. Emerging businesses will follow in 2027 under a three-year phased rollout, according to an NRS calendar shared with TechCabal.

Mohammed Bawa, who leads the e-invoicing programme at the NRS, said the goal is broader than increasing tax revenue.

“Technology is not just about delivery of outputs,” Bawa told TechCabal in an interview. “The outcome we expect is greater visibility, more transparency and making everyone more accountable.”

If implemented successfully, the system would give Nigeria its first real-time view of commercial activity across the economy. Officials say that could make tax evasion harder, reduce compliance costs for companies and provide policymakers with richer data for economic planning. If adoption is weak, however, the project risks joining other ambitious public-sector technology efforts that failed to achieve their intended scale.

Nigeria is joining a growing number of African countries—and a broader global trend—that have adopted electronic invoicing to strengthen tax compliance and digitise revenue collection. Continuous transaction control (CTC) models, where tax authorities receive invoice data in or near real time, have been pioneered across Latin America, with Brazil, Mexico and Chile among the earliest adopters, and are now being expanded across the European Union under its VAT in the Digital Age (ViDA) initiative.

Tanzania introduced its Electronic Fiscal Device Management System (EFDMS) in 2010, requiring businesses to issue fiscal receipts through certified electronic devices connected to the tax authority. Rwanda followed in 2017 with the second generation of its Electronic Billing Machines (EBM 2), a system that automates invoice reporting and has significantly improved VAT compliance.

Uganda launched its Electronic Fiscal Receipting and Invoicing System (EFRIS) in 2020, allowing businesses to transmit invoice data directly to the Uganda Revenue Authority in near real time. Ghana later rolled out Virtual Sales Data Controllers (VSDCs) in 2023, replacing physical fiscal devices with cloud-based software that captures transaction data electronically.

South Africa, by contrast, is rolling out its digital tax and e-invoicing framework through its VAT Modernisation Project, with the legal foundation proposed in late 2025 and phased mandatory implementation expected to begin in 2028.

With one of Africa’s largest economies and more than 2.5 million registered businesses, Nigeria’s rollout could become the continent’s largest e-invoicing programme. That registered business count, however, represents only a fraction of total economic activity in a country where the informal sector accounts for over half of GDP by some estimates, meaning the platform’s long-term reach will depend on how many smaller operators it can eventually bring into the formal tax net. Its outcome could also serve as a model for other emerging markets pursuing digital tax reforms.

From paper invoices to machine-to-machine exchange

The e-invoicing project marks a major change in how government approaches taxation. Instead of relying mainly on annual filings and audits, the NRS is building a system that continuously receives invoice data directly from businesses through approved Access Point Providers and System Integrators.

Each transmitted invoice carries a unique Invoice Reference Number, enabling the tax authority to compare what companies actually sell with what they later report in tax returns, according to Bawa.

“If you say your turnover is ₦10 million ($7,253), we can compare that with the invoice data,” Bawa said. “The whole essence is for invoices to serve as a deterrent, not to punish.”

The technology is not simply a replacement of paper invoices with digital files.

“Electronic invoicing is exactly what it sounds like—creating and exchanging invoices electronically,” Emmanuel Edet, Acting Director of Regulation and Compliance at the National Information Technology Development Agency (NITDA), Nigeria’s technology regulator, told TechCabal in an interview.

“But it goes beyond simply generating a digital copy of an invoice. The real concept is about machines communicating directly with other machines.”

Edet used a supermarket example to explain the system. When a bottle of Coca-Cola is sold, the inventory system automatically updates stock levels. Once inventory falls below a set threshold, the system sends a purchase request directly to Coca-Cola. Coca-Cola’s own system then automatically generates and sends an electronic invoice, without emails, phone calls or manual paperwork.

“That entire exchange happens digitally,” Edet said. “That is the essence of electronic invoicing.”

For the tax authority, those digital exchanges create a continuous stream of commercial data it has not previously had. Officials also say the benefits are not limited to taxation.

“The NRS is interested in transaction volumes for tax administration,” Edet said. “But the system also provides visibility into trade volumes, supports cross-border commerce under the African Continental Free Trade Area (AfCFTA), and enables better tracking of both physical and digital transactions.”

Standardised digital invoices can make transactions easier to verify across jurisdictions, cut paperwork and customs delays, and improve VAT administration and fraud detection. For businesses, particularly small and medium-sized enterprises, they can simplify compliance across multiple markets and create trusted transaction records that may support access to trade finance. The AfCFTA, which spans 54 AU member states and a market of more than 1.3 billion people, creates additional demand for interoperable digital invoicing standards that Nigerian businesses could benefit from as cross-border trade accelerates.

Learning from other countries’ setbacks

Creating a national tax platform that businesses actually use requires more than building software.

Several governments have struggled with digital tax systems after prioritising technology over stakeholder engagement. Poland suspended its mandatory e-invoicing system, KSeF, weeks before its planned 2024 launch. Kenya abandoned its hardware-based Tax Invoice Management System (TIMS) after strong resistance from businesses and replaced it with a software-based alternative between September 2023 and March 2024.

Nigeria is attempting a different approach.

According to Sadiq Arogundade, founder of D’Accubin, the Nigerian software company that developed the NRS platform, the agency spent months engaging businesses before development began. He said feedback shaped the system long before any production code was written.

The agency established industry-specific focus groups for telecommunications, manufacturing, oil and gas, banking and other sectors, according to Arogundade, who is also Lead Consultant to the NRS on the National E-Invoicing Initiative. Officials met companies including MTN, Huawei, UBA, Access Bank and Ecobank to understand how invoices were generated within existing systems.

“We didn’t wait for the challenges to come before thinking about how to mitigate them,” Arogundade told TechCabal in an interview.

He said consultation continued after development through stakeholder sessions, pilot programmes and repeated testing before enforcement. The phased rollout was also designed to reflect lessons from countries that had difficulty implementing national systems.

“Many countries are trying to copy this model,” Arogundade said. “Malaysia implemented something similar, and it failed. One of the strategies we adopted was rolling it out in phases instead of forcing every business sector to migrate at once.”

Malaysia slowed its e-invoicing rollout by extending a penalty-free transition period through 2026 and raising the mandatory compliance threshold to RM1 million ($244,600) in annual revenue, effectively exempting micro-businesses and small traders.

Building the ecosystem

NITDA is responsible for accrediting the companies that support onboarding to the platform.

“Our role is essentially to enable the ecosystem,” Edet said. “Technology companies provide electronic invoicing solutions. We ensure any company operating in this space is technically competent.”

NITDA certifies Access Point Providers and System Integrators by checking that they meet standards for cybersecurity, data protection, electronic invoice formats and system reliability.

When accreditation opened in early 2025, about 37 companies applied. At first, only around a dozen met the technical requirements. Edet now estimates that roughly 50 providers have been certified.

Many applicants believe they are ready when they apply, he said.

“When we evaluate them, they often discover gaps and have to go back and improve their systems,” Edet said.

One of NITDA’s firm requirements is that e-invoicing data must be hosted in Nigeria. The rule aligns with the country’s wider focus on data sovereignty, including the Central Bank of Nigeria’s June 15 directive requiring banks and other regulated financial institutions to store critical customer and payment data locally, rather than on foreign cloud infrastructure, by January 1, 2027. Nigeria is not alone in this approach: Rwanda, Kenya and South Africa have each introduced data localisation requirements for sectors deemed sensitive, placing Nigeria’s policy within a continental trend toward asserting domestic control over economic data.

“We require data to be stored locally because we want Nigeria to maintain sovereignty over economic data generated within the country,” Edet said. “That data is important for national planning and development.”

Connectivity is another major challenge. Large Nigerian companies use a fragmented enterprise software landscape, with ERP platforms ranging from SAP and Oracle to Microsoft Dynamics, Sage, Odoo and locally built accounting systems. Any national e-invoicing rollout must therefore integrate with several software environments. Replacing those systems would make compliance prohibitively expensive.

Instead, the platform uses APIs that allow existing software to communicate directly with the NRS.

Olumide Akinsola, country director of Digitax, one of the approved Access Point Providers, said businesses do not need to replace their current technology.

“We currently support integrations with more than 50 ERP systems,” Akinsola said. “I’m yet to meet an ERP that is impossible to integrate.”

Edet said businesses will face upfront integration costs, but he expects those costs to be offset over time by operational savings.

“Electronic invoicing significantly reduces paperwork, eliminates much of the documentation businesses traditionally submit to tax authorities, and lowers the administrative costs associated with compliance,” he said. “Overall, while there is an upfront investment, the long-term expectation is lower compliance costs, greater transparency and more efficient business processes.”

Beyond tax collection

Officials say the platform’s value extends well beyond tax administration. Invoice data contains information on consumption patterns, sector activity, supply chains and trade flows that can help inform economic policy.

“What people buy, how much is consumed—all that data are beyond taxes,” Arogundate said.

Bawa said the government’s broader digital agenda is beginning to converge around shared infrastructure instead of isolated systems.

Questions have been raised about whether the e-invoicing platform overlaps with the recently enacted National Identity Management Commission framework, particularly on digital identity and trust services. Bawa rejected that interpretation.

“The government is trying to reduce this silo approach of deploying systems,” he said. “If there is an opportunity to share data, everyone should come under one umbrella instead of every agency building separate solutions.”

Nigeria’s new Tax Identification Number (TIN) framework follows a similar approach. It draws on existing identity records from the National Identity Number (NIN) database and the Corporate Affairs Commission (CAC), reducing the need for taxpayers to go through separate registration processes. The NIN database has accumulated over 100 million enrolments, providing a foundation that could smooth identity verification as the e-invoicing system scales.

Adoption becomes the central test

According to Arogundade, the platform has been built to process about 50,000 requests per second using a microservices architecture that automatically distributes traffic as demand rises.

He said security was also central to the design, with encrypted transmission, public key infrastructure, role-based access controls and decentralised storage used to protect commercially sensitive invoice data.

Despite that technical design, officials acknowledge that the system’s success will depend more on adoption than on technology alone.

“Like any regulation, implementation is tested in the real world,” Edet said. “We are not afraid to adjust where necessary. Our priority is ensuring that the ecosystem functions effectively.”

He said the goal is not to exclude businesses that struggle as they move from manual to digital processes.

“Our role is simply to ensure that the technology works reliably and supports that transition.”

For now, the NRS is focused on getting taxpayers connected, integrated and transmitting invoices. Only after it collects enough transaction data will it begin comparing real-time commercial activity with historical tax filings.

“We already know what success looks like,” Bawa said. “We need to ensure taxpayers are onboarded, integrated and transmitting. Once people know the Service has greater visibility, the tendency to under-declare turnover or overstate expenses should reduce.”

If the programme reaches that point, Nigeria’s largest tax reform may be remembered less for changing tax law than for turning invoices into digital infrastructure that links businesses, government and the wider economy.