By Joe Mucheru
Africa’s population is projected to reach 1.7 billion by 2030. More than 80 percent of this population growth over the next few decades will occur in cities, making it the fastest-urbanizing region in the world. At the same time, the sub-Sahara will see some of the biggest increases in smartphone adoption this year, reaching 87 percent by 2030, up from 51 percent in 2022. This is great potential for Fintech
Indeed, mobile data traffic per mobile in Africa is set to almost quadruple by 2028. And by the end of the decade, sub-Sahara and India will account for nearly half of the world’s new mobile subscribers.
With greater smartphone adoption, Africa’s increasingly youthful and urbanized population constitutes a formidable market.
Smartphone usage is no longer just about staying connected. It is now an integral part of the way we work, shop, socialize, and, crucially, manage our finances.
While streaming your favorite radio station and scrolling through social media, you can now access quick loans, save money, make withdrawals, and payments, and invest in stocks and shares.
It is no surprise that the fintech boom in Africa has coincided with the rise in mobile money adoption and now the relative surge in smartphone adoption.
This rise in fintech companies comes at a time when telecoms companies and Internet service providers have rolled out huge infrastructures and many of them are partnering to better serve Africa.
The ever-increasing accessibility to mobile devices, internet connectivity, and network infrastructure has accelerated Africa into the second fastest market for global banking and payments businesses.
Between 2020 and 2021, the number of tech start-ups in Africa tripled to around 5,200 companies.
And just under half of these were fintechs, all making it their business to augment or fill in the gaps left by traditional financial services.
As the former ICT Cabinet Secretary in Kenya, I have seen first-hand the link between mobile connectivity and financial inclusion and the potential for both to accelerate socioeconomic advancement.
I have witnessed how technology can deliver digital services and solutions to hundreds of millions of people, transform their everyday lives, and expand opportunities for business.
For fintech founders ready to solve problems and innovate to meet the continent’s unmet needs, there is a more tremendous opportunity for growth now than ever before.
And with Africa already the youngest continent, and soon among the most populous, these fintechs can solve big problems for vast potential user bases, helping make finance available to everyone and all at the touch of a button.
Access to a smartphone and, in turn, access to credit is offering entrepreneurs the financial growth opportunities they critically need.
Having access to financial services platforms via USSD shortcodes that don’t require data or a smartphone, but due to the growth in smartphone usage in Africa, Jumo has also developed a white label app integration for e-money operators wanting to provide app-based financial services, such as credit and savings, to small business owners.
The driving force of the fintech revolution can be felt all over the world, particularly in Africa where SMEs are reaping the rewards of increased mobile connectivity and financial inclusion.
Fintech In Sub-Saharan Africa
Yet two-thirds of adults in sub-Saharan Africa still don’t have access to formal financial services, meaning they don’t have a secure and efficient means to save, transact, or access credit.
As fintech matures and mobile penetration increases, financial services on the continent are at an inflection point, and several African countries have a significant opportunity to capitalize on the momentum of recent years to help change this.
To scale up the benefits, stakeholders, including governments, telecom companies, data providers, investors, the traditional financial services sector, and fintech, have a critical role to play in creating the conditions for greater access to both connectivity and financial products and services.
As Africa embraces the smartphone revolution and realizes the potential of fintech, the region stands poised to capitalize on the opportunities presented by the digital era.
And even as all these developments take place, a new revolution is loading with generative Artificial Intelligence. Watch this space.
This post was authored by the President of Jumo and Originally appeared in the Business Daily. Read the original post here.
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