Mobile money accounts have surpassed bank accounts in Africa
The financial technology industry is shaping the structure of financial industry in Africa. New technologies have been innovated, developed and implemented in Africa creating a competitive business landscape in the financial industry. Africa which at one point was lagging behind most countries is now emerging as one of the global leaders in fintech companies.
Mobile payment company such as M- pesa was started in 2007 in Kenya. It now boasts of its presence in 10 countries with 30 million users. Other eminent competitors have emerged such as MTN money and orange Money as the use of mobile money has exceedingly grown over the last 10 years to an extent where mobile money accounts have surpassed bank accounts in Africa.
Fintech has created financial inclusion across sectors
Fintech challenges traditional financial systems in Africa and has created efficient service value chains. Even though there are several areas of concern such as the vulnerability and stability of a relatively new and volatile area, fintech is emerging as an enabler by creating financial inclusions in sectors from agriculture to infrastructure.
Since Fintech provides avenues for accessing credit it is seen more lucrative than banks as banks have tedious policy, processing and higher rates. New technologies are allowing easier global transfers at lesser cost and easily comprehensible information.
Fintech requires more regulation
However, there are darker areas that need to be addressed and made foolproof in Africa’s Fintech market. Areas such as exploitation of fintech for money laundering, funding terrorists and information access. There needs to be furthermore regulations and policies to address these vulnerabilities.
Apart from these threats, Africa has to work on scalability , better transparency and improvement in infrastructure such as internet and electricity in order to reap the maximum benefits from the momentum fintech has gained in Africa.
