Wednesday, December 04, 2019 / 1:15 PM / Nifemi Taiyese for Proshare WebTV / Header Image Credit: Global Finance Magazine
Growing concerns about the relatively slow pace of financial inclusion in Africa are likely to be resolved by the broadening and deepening of financial technology (Fintech). According to Business Research Company, the global Fintech market was valued at about $127.66 billion in 2018 and is expected to grow to $309.98bn at an annual growth rate of 24.8% through 2022. Growth in the digital payments sector is driving the market for global Financial Technology.
For Africa, the annual report from Disrupt Africa showed that Fintech companies in the region had raised $320 million in funding since January 2015, and the ecosystem has surged 60% in the last two years.
The continent's Fintech firms have grown to 491 from 301 in 2017, while the $132.8 million raised in 2018 has been the sector's best-ever year. Last year 210 African tech startups raised $334.5m.
Recently the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele, in his keynote speech at the 54th Annual Bankers Dinner, revealed that Out of the $551m worth of foreign investments in Fintech companies in Africa, Nigeria accounted for 80% which translated to $439.2m.
Africa Fintech Network
The Africa Fintech Network started with a clear mandate to bring a more coherent, dynamic and pragmatic Fintech operating environment to the continent. As part of efforts to improve the Fintech ecosystem, a recent Africa Fintech Festival staged in Kampala, Uganda. The AFN has remained focused on improving the landscape of Fintech on the continent, with critical emphasis on building a robust system for the support of small and medium-sized enterprises (SMEs) on the continent.
Looking at the regulatory space, the Securities and Exchange Commission (SEC) recently launched the Fintech roadmap for the Nigerian capital.
The roadmap was a major step for the regulator to guide the industry and advocate for the growth of Fintech industry in Nigeria.
Banks and Fintechs
Banks in Nigeria are tapping into the opportunities of partnering with Fintechs and supporting the ecosystem.
Access Bank has its Africa Fintech Foundry that serves as a hub to incubate innovations and provide the platform for deepening digital financial solutions across the globe.
Sterling bank recently hosted the Fintech Social Meet, which was an opportunity for industry players to network and explored new avenues for enhancing digital financial service in the country.
Deepening Financial Inclusion
In the area of financial inclusion, the Enhancing Financial Innovation (EFINA) has continued to promote initiatives that impact the financial services industry in the country.
Last year EFINA provided $2m funding for six (6) tech-startups to scale up their businesses.
Fintech Association of Nigeria, the fastest growing Fintech group in the globe, has been at the forefront of driving advocacy for the industry through its engagement with the government and key regulators in the country.
It has also contributed to the deepening of the ecosystem in Nigeria and has also hosted Fintech conferences.
With a supportive regulatory framework, the Fintech Industry is poised to reposition the industry to serve as Africa's preferred Fintech hub.