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Africa Positioned as Fastest-Growing Fintech Region, Projected to Reach $65 Billion in 2030


Africa is poised to become the fastest-growing region in terms of fintech revenue, according to a recent report by Boston Consulting Group (BCG) and QED Investors. The report, titled “Global Fintech 2023: Reimagining the Future of Finance,” predicts that Africa’s fintech market, led by countries such as South Africa, Nigeria, Egypt, and Kenya, will experience a compound annual growth rate (CAGR) of 32% until 2030, reaching a staggering $65 billion.

Caio Anteghini, a partner at BCG in Johannesburg, highlighted Africa’s potential, stating that the region, unburdened by legacy infrastructure, has the opportunity to leapfrog into a new financial ecosystem. With a significant portion of the population being unbanked or underbanked, fintech can play a vital role in addressing access challenges. Currently, around 52% of adults in the Middle East and Africa (MEA) region are unbanked, while 43% are underbanked.

The report emphasizes that smartphones present significant opportunities for fintech in Africa, particularly in the areas of payments and lending. By leveraging these technologies, regional fintech champions adopting full-stack attacker models can solve access issues and bring financial services to underserved populations.

Globally, the report projects a remarkable growth trajectory for the fintech industry, with revenues expected to soar from $245 billion to $1.5 trillion by 2030. Emerging economies are set to lead the way, outpacing developed markets. Asia-Pacific (APAC) is predicted to surpass the United States and become the world’s largest fintech market by 2030, with a projected CAGR of 27%.

Anteghini emphasizes that the fintech journey, both globally and in Africa, is still in its early stages, and it will continue to revolutionize the financial services industry. Despite financial services being a highly profitable sector, it often struggles with innovation and poor customer experiences. To capitalize on the opportunities, all stakeholders, including regulators and incumbents, must be proactive and collaborate with fintech firms to drive digital transformation.

While global fintech experienced a temporary decline in market value in 2022, the report suggests that this was merely a short-term correction within a broader positive trajectory. The industry’s fundamental growth drivers remain intact. Nigel Morris, QED Investors’ managing partner and co-author of the report, expresses optimism about the future of fintech, highlighting its potential to improve the lives of billions of people worldwide.

The report sheds light on Africa’s fintech future, noting that while cash still dominates, fintech can address the access gap, given the high percentage of underserved or unbanked individuals. With Africa being the youngest and fastest-growing region globally, demographic shifts and increasing earning power will further drive the need for financial access. The authors expect leapfrogging in technology, particularly in cashless payments, where smartphones will play a pivotal role.

Historically, telco-fintech players like Safaricom’s M-Pesa and MTN Mobile Money have played a significant role in driving fintech growth in Africa. These players, along with grassroots fintech firms, are expected to continue shaping the industry’s landscape.

The report highlights the role of regulators, noting that historically, fintech regulation has been relatively light and fragmented. However, regulators must strike a balance by implementing appropriate guardrails without stifling innovation. Recommendations include streamlining licensing processes, fostering an open banking ecosystem, and supporting digital public infrastructure.

Furthermore, the report predicts that neo-banks and B2B fintech segments will play essential roles in expanding financial access and inclusion. While payments have dominated the fintech journey thus far and will continue to be the largest segment, B2B2X, and B2B services are expected to lead the next era of fintech growth.

Anteghini concludes by emphasizing that the fintech industry is still in the early stages of a 25-year or longer growth journey. Africa, in particular, offers tremendous opportunities for growth, and the momentum is just starting to build.



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