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You might be here because you spotted ‘Fintech’ and thought, “Ah, I’ve seen this before.” At the same time, you might be thinking of looking up the fancy word on Google. Either way, come on in and take a seat. This article explores the fintech ecosystem in Africa. We shall focus on the advantages of the market, developments, and challenges in the sector.

Fintech is a portmanteau drawn from financial technology. It integrates new technology by financial institutions to help enhance the delivery and access of financial services. A well-known example is the Kenyan-based M-pesa platform, which allows for micro-financing and money transfer with the touch of a few buttons. However, this is one of the many growing numbers of fintech platforms we shall explore in Africa. However, let us first rewind to where it all began. 


Many years ago, people measured their finances and wealth by the number of livestock or food crops in their barn or field. At first, we had barter trade. Time passed, and Governments introduced coins as a means of exchange. Eventually, notes came about, giving birth to a banking system. At this time, technology was advancing at an eruptive rate, and as it influenced every other field in human civilization, financial services were among the top sectors riding the technological wave. Soon, one could conduct transactions via a card. This was when fintech was fully born; ever since, financial companies worldwide have been on an innovative trend to fully utilize transcending technologies such as artificial intelligence to automate and lubricate the processes involved in providing financial services.

Africa is on the radar for the growing application of financial technology. The continent has an impressive growth rate. According to a recent report done by McKinsey & Company, fintech could add up to $3 trillion to Africa’s GDP by 2025. This growth is favored by Africa’s young population leaning more towards implementing digital devices in their daily lives. In addition, Africa has investor eyes prying on the continent as there is a large untapped market in the digital financing sector. This prompts investors to push towards establishing fintech companies and taking a bite of Africa’s unexplored market share.

On March 2007, Safaricom PLC Launched M-pesa in Kenya and became Africa’s first mobile money platform. The platform has become the most prominent fintech service provider on the continent. What then followed was an explosion of fintech companies. They spread like a virus across the continent. Guess what? A virus was one of the major catalysts in the growth of fintech in Africa. The Covid-19 pandemic spurred the use of electronic forms of transactions in day-to-day activities. Fintechs like M-pesa saw a major lift in their clients as the population shifted to mobile money transfers and payments. This leads us to one of the major players in implementing financial technologies, Kenya, which has over 418 fintech startups. The most popular ones include Pezesha a digital Financial Ecosystem for connecting MSMEs to Capital. @KopoKopo, a payment platform partnered with M-pesa to bring the M-pesa By Goods service, Pesapal Alifestyle app you can use to pay all your bills in bulk at a go in one transaction, Bitpesa a digital wallet for cross-border currency transfers, NALA, a mobile money transfer for Africans worldwide and digital lenders like Tala Zenka Digital, Branch International, LOOP, and Mara, an online platform for digital wealth learning for cryptocurrency. All these startups propel the Kenyan market to the top of the food chain when it comes to the fintech sector. 

Another country that displays success in the fintech ecosystem is Egypt. Egypt entered the fintech race when Fawry mingled with financial technologies such as digital payments. Fawry is a financial company in Egypt established in 2008. It became Egypt’s first fintech titan when Egypt’s Central Bank began licensing digital financial services. More fintech startups cropped up over the years, such as Thndr in late 2020 and PaySky in 2017, which respectfully offer Financial and Digital Payment services. 

In Nigeria, Interswitch Group and SystemSpecs dropped into the market and placed Nigeria at the top three fintech hubs in Africa. Presently, Nigeria has over 200 fintech bodies. With the wide availability and use of mobile smartphones in Nigeria, fintech has found a favorable ground to thrive. Flutterwave is one of the best of Nigeria’s success stories when it comes to financial technology. The company provides payment services across Africa, enabling people to conduct seamless cross-border transactions worldwide. Among others, such as Piggyvest, Kuda, and Paga Group Ltd have catapulted Nigeria’s financial market into a fintech scenery.

It is impossible to mention fintech and leave out South Africa. The nation brags 982 startup fintech companies that are playing a major role in influencing the direction the African continent will take regarding financial technologies. What makes South Africa stand out in the field are the already established traditional financial institutions that foresee fintech as a threat to their existence. Most are inflexible, making it an unfavorable ground for fintech to develop. However, fintech companies like JUMO, Yoco, VALR, and have gone all out past the challenge and established digital financial services that offer online marketplaces for consumer and business loans, provision of payment processing solutions for businesses and offering platforms for cryptocurrency trading. 

Rwanda is also dipping its toes into the fintech industry, where the government has laid out a five-year strategy to position Rwanda as a fintech hub. According to the government, the strategy has two complementary policy goals: to position Rwanda as a regional financial center and promote customer-centric financial inclusion and social development through fintech development. According to The Fintech Times, Rwanda launched the first fintech-focused fund, which was done by The Kigali International Financial Center (KIFC). The fund was valued at $ 50 million and backed by Vusi Thembekwayo‘s MyGrowtFund as a venture partner. The fund is set to increase investment in African fintech by African firms.


The fintech market in Africa is rapidly evolving, with it a tsunami of opportunities and solutions for most of the troubles brought about by the traditional financial systems. The most prominent advantage Africa enjoys from the fintech market is the availability of mobile banking. Most African can use the service to send and receive money both domestically and across foreign borders. Moreover, these services offer a fast, convenient, and cost-friendly way of completing transactions. 

Fintech has improved financial inclusion for consumers and businesses by providing access to financial services and products. These products were unavailable or difficult to acquire in the traditional banking system, especially for those in the disadvantaged sectors of society. Anyone can easily acquire a financial service at the palm of their hand through innovations by fintech. 

Financial technology demands a huge number of technical skills. The need for these skills will create career opportunities that involve tasks such as maintenance of the elements that keep a certain field of fintech running. Moreover, fintech will provide grounds for complementary necessities such as security programs for safeguarding digital assets. These programs will, in turn, create more career opportunities.


The most significant challenge facing the rising fintech sector in Africa is cybercrime and online fraud. Just recently, on July 27th, 2023, a cyber-attack launched at M-pesa, and critical online government services rendered some of the online services unavailable. As a result, Kenyans were disconnected from essential services such as paying utility bills, digital banking, and mobile money transfers. While the fintech sector is developing quickly, the involved companies are having difficulty keeping up with the trends and ensuring that there will be no vulnerabilities in the new financial system. Hackers are taking full advantage of the system’s infancy and will collapse the fintech industry if not checked upon. 

Another major complication the African fintech sector faces is the lack of a clear regulatory standard. As fintech companies are briskly popping out across the continent, many countries are yet to put in place regulations that provide a healthy environment for market sustainability. Unregulated startups can lead to the toxication of the fintech industry, where integrity and confidence will be lost in the chaos of fraud and online scams. 

Regulatory sandboxes, which allow for testing new fintech solutions in a controlled environment, are still a rarity in the African continent. The lack of these testing grounds inhibits the growth and expansion of innovative fintech solutions. It creates an environment of uncertainty that could stifle innovation and deter investment.

Additionally, inadequate infrastructure is a limiting factor, especially in rural areas. Despite mobile money’s popularity, many rural areas still lack reliable internet and electricity, making it challenging for these digital solutions to reach their full potential.

Furthermore, the dearth of tech talent is a pressing issue. While Africa is teeming with young, creative minds, there’s a lack of structured platforms and opportunities for these individuals to acquire the necessary technical skills.

Africa is developing, and as a result, most of the resources primarily get channeled to stabilizing infrastructure. This limits the growth of secondary advancements such as financial technologies. With the weight of development and basic sustainability occupying most of Africa’s agenda, fintech gets side-objective attention, and even though rapid growth is in place, deterrence remains on the fintech industry due to the limited resources. 

What can be done? 

For starters, governments can be more proactive in fostering a conducive environment for fintech innovation. This includes establishing clear and flexible regulatory frameworks that balance innovation and risk. It also involves investing in infrastructure such as internet connectivity and reliable electricity supply, particularly in rural areas.

Partnerships can also play a crucial role. Collaboration between fintech startups, traditional banks, and telecommunication companies can drive the growth and reach of fintech solutions. These partnerships can leverage each player’s strengths, leading to more robust and comprehensive services for users.

Investment in education and training programs in relevant tech fields is necessary to address the skills gap. This could involve partnerships with universities and technical institutions, both locally and internationally, to provide tailored courses and training programs.

On the other hand, fintech founders who have succeeded need to play their part in growing the ecosystem. This could be through mentorship programs, investing in other startups, or establishing funds to support fintech innovation.

In summation, fintech has taken Africa by storm and has an even more enormous growth potential. The digitization of financial services has created a new landscape for the financial sector that will propel Africa to new heights. Instant global money transfer and accessing financial services from the comfort of one’s home or while traveling has reshaped the financial sector in Africa. Implementing Blockchain in banking systems has provided a secure and transparent way of recording transactions. However, challenges such as cyber-attacks and a lack of regulations are weighing down on the development of the fintech sector in Africa. 

While challenges exist, the promise and potential of fintech in Africa are undeniable. The journey may be challenging, but the destination – a financially inclusive Africa – is well worth it. Either way, the future is here, and financial technology is one of the many thresholds.

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