why the future of fintech is in africa
The financial technology (fintech) industry is booming, and Africa is at the forefront of this growth. According to a recent report by McKinsey & Company, ‘the fintech market in Africa is expected to grow from $15 billion in 2019 to $100 billion by 2025.’ This growth is being driven by a number of factors, including the region’s young and growing population, rising smartphone adoption, and increasing internet penetration.’
Africa is home to some of the world’s youngest and fastest-growing populations. The United Nations states that ‘the continent’s population is expected to grow from 1.2 billion in 2019 to 2.5 billion by 2050.’ There is a young population that is increasingly demanding access to financial services, and fintech companies are stepping in to meet this demand.
Mobile internet adoption is also growing rapidly in Africa. According to GSMA, there were 287 million mobile internet subscribers in Africa in 2022, and this number is expected to reach 438 million by 2030. This growth is being driven by the increasing affordability of smartphones and the expansion of mobile networks.
The World Bank says the internet penetration rate in Africa was 35% in 2019, and this number is expected to reach 50% by 2025. This growth is being driven by the increasing availability of affordable internet access as well as the growing use of mobile devices.
According to Statista, the fintech market in Africa measured by Assets Under Management in 2023 is $29.63B and within 4 years is expected to reach $54.70B.
The combination of a young and growing population, rising smartphone adoption, and increasing internet penetration is creating a perfect storm for fintech growth in Africa. Fintech companies are using these technologies to provide innovative financial services to underserved and unbanked populations.
There are a number of ways that fintech is making a difference in Africa. For example, fintech companies are using mobile money to provide access to financial services for people who live in remote areas or who do not have bank accounts using older technologies like USSD. Fintech companies are also using digital lending to provide small businesses with access to credit. Furthermore, fintech companies are using blockchain technology to create secure and transparent financial transactions.
I believe the future of fintech is bright in Africa. The region’s young and growing population, rising smartphone adoption, and increasing internet penetration create a perfect storm for fintech growth. Fintech companies are using these technologies to provide innovative financial services to underserved and unbanked populations which in turn improves financial inclusion and economic development in Africa.
As fintech continues to grow in Africa, it will have a significant impact on the continent’s financial landscape. Fintech companies will play a key role in providing access to financial services for underserved and unbanked populations.
The question for you reader;
Will you be part of this change?
