Turning Daily Savings into Sustainable Capital
Omolabake Fasogbon
Amid the challenges of obtaining business credit in Nigeria, citizens are devising alternative ways to fund their ventures, one of which is petty savings in local piggy banks.
Stories abound of how consistent, daily savings from modest earnings have transformed lives and met urgent needs. Increasingly, these small savings are being harnessed as capital to start a business or side hustle.
Interestingly, fintech platforms like PiggyVest and Cowrywise are also incorporating this practice into their products. Nigerians continue to rely on this method to finance micro-businesses, which in turn fuels growth of micro-enterprises across the country.
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) reports that lack of finance, alongside low financial literacy and inadequate business management skills, remain the biggest barriers to small business success. In this context, self-funding through personal savings is increasingly a lifeline.
A recent Moniepoint report indicates that 40.2 percent of female entrepreneurs rely primarily on personal funds and savings as their main source of capital.
Similarly, a 2020 survey of MSMEs, referenced by the Development Research and Projects Centre (dRPC), found that 59 percent of sole proprietorship-owned small and medium enterprises in Nigeria used personal savings as their primary source of capital.
Awareness of the power of small, disciplined savings is growing. Nigerians are setting aside little amounts daily, whether in traditional wooden piggy banks or modern digital savings tools to fund business ideas over time.
One Facebook user, Lara Wise, shared her experience, noting that daily tiny savings helped her life, while emphasising that it does not have to be a lump sum.
“Even amounts like N50 or N100 saved consistently can accumulate into meaningful capital”, she advised.
She further suggested business ideas that could be launched with small savings, such as ice-block sales, jewellery businesses, and wristwatch retail, generating daily, weekly, or monthly income.
Comments on her post reveal widespread interest, with testimonies from Nigerians who have used daily savings to start business like hand-beaded crafts and fabric trading businesses with as little as N30,000. Above all, financial experts reiterate discipline, alongside the practical nuggets below as essential to turning small daily savings into sustainable income streams
Don’t Break the ‘Bank’ Too Early
Before opening your piggy bank, set a clear savings target for your business. Decide how much money you need to start meaningfully, whether it’s ₦50,000 or ₦100,000 , stick to it. Breaking piggy bank too soon can leave you undercapitalized, forcing compromises like buying insufficient stock or cheap supplies that affect the quality of your products. Waiting until you reach your goal allows you to start with confidence, ensuring that your first business steps are strong and sustainable.
Focus on Needs, Not Wants
When choosing a business, prioritize goods and services that meet everyday needs rather than luxury or non-essential items. Products like ice blocks, cold drinks, staple foods, mobile phone repairs, or basic fashion accessories usually have steady demand because people require them regularly. Starting with essential goods reduces the risk of slow sales, especially in an unpredictable economy, and increases the chances that your business will generate consistent income from day one.
Keep Saving While Selling
Your first profit is not for indulgence, it’s capital to grow your business. Allocate a significant portion of earnings back into stock, equipment, or savings instead of spending everything immediately. For example, if you earn N5,000 in a day, consider reinvesting N3,500 to restock and using N1,500 for personal needs. Reinvesting profits consistently allows your business to grow steadily, ensures you have funds to handle unforeseen expenses, and gradually builds a reserve that can fund bigger opportunities.
Track Every Kobo
Even small businesses need basic financial tracking. Record every income, expense, and savings contribution in a notebook or simple spreadsheet. Tracking your money prevents losses from overspending, helps you identify which products or services are most profitable, and allows you to make informed decisions about restocking, pricing, and expansion. Keeping clear records also helps you measure progress over time, motivating you to stay disciplined and improving your long-term business planning.
Leverage Community and Mentorship
You don’t have to grow your business alone. Join local savings groups, cooperatives, or online networks of entrepreneurs. These communities can provide additional funding through pooled savings, advice on business strategies, and access to suppliers or customers. Mentorship from experienced business owners can teach practical skills, like negotiating with vendors or marketing products effectively, which you might not learn on your own. Building these connections can be as valuable as the money you save.
Start Small, Scale Gradually
Begin with a small, manageable investment and a limited product range. Test the market to see what sells best and monitor customer feedback before increasing inventory or expanding services. Scaling too quickly with limited capital can lead to wasted money, stress, and business failure. Gradual growth allows you to learn the market, adapt strategies, and increase revenue steadily without compromising quality or financial stability.
Maintain Discipline and Patience
Building a business from small savings is a marathon, not a sprint. Stick to your savings goals, avoid impulsive spending, and reinvest profits carefully. Patience and discipline are essential because the results may take time to appear, especially in micro-businesses with low starting capital. Consistency in these habits strengthens not only your business but also your personal financial skills, making you more resilient and prepared for future opportunities.
