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Pricing and Payment

The Impact of Currency Fluctuation on Nigerian Freelancers

Last Updated on July 27, 2023


Currency fluctuation refers to the continuous variation of the value of a particular currency against another currency.

It is caused by various factors such as geopolitical events, economic policies, and market forces.

Nigerian freelancers have not been spared from the impact of currency fluctuation as it affects their income, payment, and overall financial stability.

The value of the Nigerian naira has been unstable in recent years, affecting the purchasing power of Nigerian freelancers who are mostly paid in foreign currencies such as the US dollar.

When the value of the naira drops, freelancers receive fewer naira for the same amount of dollars they earn, leading to a decrease in their income.

This instability also affects payment processing, as it takes longer for freelancers to receive payment due to delays in currency conversions and bank transfers.

In addition, some clients may be hesitant to work with Nigerian freelancers due to the currency instability, leading to fewer job opportunities.

The impact of currency fluctuation on Nigerian freelancers cannot be overlooked, as it affects their financial well-being and overall quality of life.

It is important for freelancers to stay informed about currency trends, diversify their income streams, and explore alternative payment methods to minimize the impact of currency fluctuations.

Understanding Currency Fluctuation

As a Nigerian freelancer, currency fluctuations can have a significant impact on your income.

Understanding what currency fluctuation is and how it affects you is essential to making informed decisions about your finances.

What is Currency Fluctuation?

Currency fluctuation refers to the changes in the value of one currency against another.

For example, if you are a Nigerian freelancer and receive payments in US Dollars, changes in the exchange rate between the Nigerian Naira and the US Dollar will affect your income.

Causes and Effects of Currency Fluctuation

There are many factors that can cause currency fluctuation, including economic policy changes, geopolitical events, and supply and demand factors.

The effects of currency fluctuation can be both positive and negative.

  • Positive effects: If the currency of the country you receive payment in becomes stronger against your local currency, you will receive more money for your work.

  • Negative effects: If the opposite happens, you will receive less money for your work. This can lead to financial difficulties and make it hard to pay your bills and expenses.

Inflation and Currency Fluctuation

Inflation significantly impacts currency fluctuation as it denotes the increase in prices of goods and services.

If inflation is high, it can lead to a devaluation of the currency and cause currency fluctuation.

  • High inflation: High inflation makes the currency less valuable, causing it to lose its purchasing power.

  • Low inflation: Low inflation makes the currency more valuable, giving it more purchasing power.

In fact, currency fluctuation is a reality that Nigerian freelancers need to understand and prepare for.

By staying informed about the changes in exchange rates and taking steps to protect their income, freelancers can minimize the impact of currency fluctuations on their finances.

Read: Successful Financial Management for Nigerian Freelancers

The Impact on Nigerian Freelancers

As a Nigerian freelancer, currency fluctuation can have a considerable impact on your income and purchasing power.

Here are some points to consider:

How Currency Fluctuation Affects Nigerian Freelancers

  • When the value of the Nigerian currency drops, Nigerian freelancers lose out on valuable payments in their local currency.

  • Thus, Nigerian freelancers depend heavily on foreign currencies such as USD, EUR, or GBP to receive payment for their services.

  • Currency fluctuations make it difficult for freelancers to predict how much money they will receive, leading to financial instability.

How Currency Fluctuation Affects Payment

  • Currency fluctuation can cause a delay in payment as clients want to wait for the currency to stabilize and avoid any losses.

  • Freelancers are at the mercy of payment platforms like Paypal that charge high exchange rates and fees, even as the value of the Nigerian currency drops.

The Impact on the Purchasing Power of Nigerian Freelancers

  • Currency fluctuation directly affects the purchasing power of Nigerian freelancers, making it difficult to buy basic necessities and pay bills.

  • When the value of the Nigerian currency drops, the prices of imported goods rise, making it harder for freelancers to afford them.

  • Nigerian freelancers are at a disadvantage compared to foreign freelancers who enjoy stable currencies.

In essence, currency fluctuation can have a significant impact on Nigerian freelancers, affecting their income, payment, and purchasing power.

Freelancers need to be aware of these challenges and find ways to mitigate them for financial stability.

Read: Creating Effective Invoices for Freelance Work in Nigeria

The Impact of Currency Fluctuation on Nigerian Freelancers

Strategies for Nigerian Freelancers to Mitigate the Impact of Currency Fluctuation

Currency fluctuation can seriously impact the earnings of Nigerian freelancers. As the value of their currency changes, so does the value of their earnings.

Luckily, there are strategies that freelancers can use to mitigate this impact and protect their earnings.

Protect Your Earnings

One strategy is to protect your earnings by using a payment processor that converts payments into your local currency immediately.

This way, you receive your earnings in your local currency before any major changes in the exchange rate occur.

You should also consider setting up a retainer agreement with clients that includes a foreign currency adjustment clause.

This clause will ensure that your earnings are adjusted to reflect changes in the exchange rate.

Use Currency Exchange Platforms

Another strategy is to use currency exchange platforms to convert your earnings from foreign currency to your local currency.

These platforms offer competitive exchange rates and can be more cost-effective than using traditional banks.

Some popular currency exchange platforms include TransferWise, PayPal, and Skrill.

Create a Foreign Bank Account

If you frequently receive payments in foreign currencies, you may want to consider opening a foreign bank account.

This will allow you to receive payments in the foreign currency and avoid paying high currency conversion fees.

Additionally, this strategy can help you avoid the risk of currency fluctuations. By keeping your earnings in a foreign bank account, you can choose the right time to convert your earnings into your local currency when the exchange rate is most favorable.

Build a Diverse Portfolio

A final strategy is to diversify your portfolio by accepting projects in different currencies. This can help you spread your earnings across various currencies and minimize the impact of currency fluctuations.

Furthermore, by accepting projects from clients in different countries, you can expand your network and increase your chances of finding high-paying clients in stable currencies.

In review, currency fluctuation can have a major impact on the earnings of Nigerian freelancers.

However, by implementing these strategies, you can protect your earnings and minimize the impact of currency fluctuations.

Remember to protect your earnings, use currency exchange platforms, create a foreign bank account, and build a diverse portfolio.

With these strategies in place, you can continue to grow your freelance business and maintain a steady stream of income, regardless of changes in the exchange rate.

Read: Dealing with Late Payments: A Nigerian Freelancer’s Guide

The Role of the Nigerian Government

  • The Nigerian government has a critical role to play in assisting Nigerian freelancers who are affected by currency fluctuations.

  • Freelancers largely work online and get paid in foreign currencies, making currency fluctuations an inherent risk to their income.

  • The government can help freelancers by creating an enabling environment for businesses to thrive and encouraging foreign investment.

  • The government can also provide financial support and training for freelancers to improve their skills, making them more competitive in the global market.

  • Government interventions are essential in protecting the income of Nigerian freelancers and promoting economic stability in the country.

The Importance of Government Intervention in Currency Fluctuation

One key area where the government can intervene is in the regulation of exchange rates.

Frequent fluctuations in exchange rates can lead to drastic changes in the cost of living and economic growth. Freelancers who receive their incomes in foreign currencies are highly vulnerable to such fluctuations.

How the Government can Monitor and Regulate the Exchange Rates

To regulate exchange rates, the government can monitor the foreign exchange market and manipulate exchange rates through its central bank.

This can help maintain stable exchange rates that are favorable to Nigerian businesses and freelancers while also helping to control inflation.

Another way the government can support Nigerian freelancers is through the implementation of policies that help to minimize the negative impact of currency fluctuations.

Such policies could include providing tax breaks or subsidies to freelancers in the event of currency devaluation or creating initiatives to help freelancers hedge against currency risks.

The government can also play a role in encouraging the growth of online marketplaces and freelance platforms that connect Nigerian freelancers with global clients.

This can help to increase the earning potential of Nigerian freelancers while also promoting the country’s economic growth.

Government support and intervention in the realm of currency fluctuations can enable Nigerian freelancers to overcome the challenges posed by a volatile exchange rate environment.


  • Currency fluctuations are an unavoidable risk for Nigerian freelancers who earn their income in foreign currencies.

  • The government has a critical role to play in supporting freelancers and protecting their income while promoting economic stability in the country.

  • The Nigerian government can monitor and regulate the exchange rate to create a favorable environment for businesses and freelancers, provide financial support and training to improve freelancers’ skills, and encourage the growth of online marketplaces that connect freelancers with clients globally.

The government must take action to protect the income of Nigerian freelancers, crucial for economic growth and development.

With the right support and intervention, Nigerian freelancers can overcome the challenges posed by currency fluctuations and thrive in the ever-growing global market.

Read: Essential Pricing Tips for New Freelancers in Nigeria


To summarize, currency fluctuations have a significant impact on Nigerian freelancers. With the value of the naira always in flux, freelancers’ earnings can vary wildly from month to month.

This can lead to financial instability and stress. The best way to deal with this situation is by being proactive. Freelancers need to educate themselves and stay informed about the state of the naira.

They should also explore payment options that allow them to receive payments in foreign currencies which are more stable.

Lastly, the impact of currency fluctuations on Nigerian freelancers cannot be ignored. The onus is on each freelancer to take the necessary steps to adapt to these changes and stay ahead of the game.

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