Many businesses in Africa depend on Fintech solutions to facilitate cross border payments in the over 42 different currencies across the continent.
The Fintech industry has transformed the monetary ecosystem rapidly in the last decade with Kenya leading a global revolution in mobile money, allowing seamless transactions for consumers.
The Kenyan Wall Street in collaboration with Kora, Onafriq and Conduit, hosted a Webinar delving into the future of Fintech in Africa, highlighting opportunities and challenges in the industry.
In this article
Africa’s fintech landscape in the past 5 years
Over the past five years, Africa’s fintech landscape has experienced significant transformation, marked by rapid growth, increased investment, growth explosion and evolving challenges. In the past few years, governments including Kenya, Nigeria, Benin and Ethiopia have taken on digital IDs to drive inclusion and penetration while enhancing service delivery.
The continent witnessed increased digitalization of business payments beyond the traditional peer to peer where the journey began, with financial services integrated into non financial platforms, broadening access to financial tools. The years were marked by atomization of different services with more specialization and niche products and services coming to the core with tailored customer experience.
Regulatory clarity, where policy makers have forced innovation, prompting building of interesting solutions such as embedded credit in the Buy now Pay later option.
Embedded Finance: The Catalyst in Global Money Circulation
Embedded finance has revolutionized global money movement by reducing friction, optimizing for speed, and solving challenges around trust, legal compliance, and security.
According to Stephen Oluwatobi, the Chief Operating Officer at Kora, traditional methods used to take close to two weeks to finalize cross border transactions. “It was faster to take a bus to the border, make payments and come back. That is how slow it was to transact about 10 years ago,” Stephen Oluwatobi, COO, Kora, said in the session.
Today, fintechs are addressing these inefficiencies while shouldering the burden of compliance and security, enabling seamless, reliable payments across fragmented markets and driving the next phase of financial connectivity.
According to the Future of Embedded Finance report by Kora and Finextra, 90% of transactions in Africa are still cash-based, and embedded finance can help bridge that gap.
Challenges in the marketplace
Fintechs face higher risks around the Know Your Customer process as it involves more databases and a range of customers operating across borders where different KYC standards apply.
The complexities of navigating data privacy – who gets access to what and who is entitled to share the data arising from vast amounts of customer data. Balancing innovation while navigating multiple regulatory compliance as well as the fragmentation around treasury services which impacts cost of services of different currencies
The panelists cited finding the best entry to different markets across Africa as a challenge due to industry’s complexities.
Advancing financial inclusion and financial literacy
“The journey never ends,” Stephen noted, adding that fintechs have to continually invest in educating all participants including merchants and the public using diverse platforms incorporated in articles, videos, summits and social media at large.
Financial literacy can be linked to digital literacy ensuring continuous protection of cyberspace to ensure safety of all transactions. The education spans beyond just using money effectively, saving money, insurance, securing assets or making payments ensuring there’s no loss in any way.
Erick Wainaina, General Manager Africa, Conduit touched on the need to build interesting touch points of access – “meet the consumer where they are.” Build user friendly solutions, embedding the learnings in the process including the use of USSD while keeping your information correct.
Fintechs across the continent can create value collectively as stakeholders come together to deepen penetration for economic growth. While fintechs may partner, they often compete on niche services or technological capabilities.
Impact of embedded finance on MSMEs and entrepreneurs
Embedded finance is set to transform the landscape for small businesses and entrepreneurs across the continent by streamlining access to financial services directly within the platforms they already use to operate and grow their businesses.
Traditionally, starting a business involved significant challenges, from managing payments to securing capital and packaging value effectively. Fintechs have stepped in to solve these problems by integrating financial tools like payments, credit, insurance, and lending into e-commerce platforms, accounting software, and business management tools.
Embedded finance allows small businesses to get paid faster, access financing more easily, and automate workflows, creating a more seamless and efficient business environment.
Policies to unlock the industry’s potential
As one of the fastest-growing subsectors of the ICT industry, fintech has proven its value through job creation and expanding access to financial services.
Governments have made steps towards adopting a hybrid regulatory approach that encourages innovation while ensuring stability, including deregulation around wealth management and wealth tech to enable broader access to financial tools. Lowering barriers to entry, such as simplifying licensing processes, will allow more players to participate and build localized solutions tailored to the specific needs of African consumers.
Trust and transparency must remain central, with an interconnected ecosystem that promotes harmony among regulators, fintechs, and consumers. Regulators are increasingly supportive, and fintechs must remain prudent, customer-focused, and compliant to drive sustainable growth across the industry.
Africa’s fintech industry in the next decade
Over the next 10 years, Africa’s fintech industry will experience significant growth driven by deeper adoption of digital financial products, especially among MSMEs and the continent’s large, young population.
ESG principles will shape how fintechs innovate to deliver low-cost, high-impact solutions with strong value retention. Cities like Lagos and Nairobi will solidify their roles as fintech hubs, while new opportunities will emerge in sectors like construction and manufacturing.
Payment gateways will expand, savings and investment solutions will become more accessible, and increasing digital adoption will unlock greater wealth and financial inclusion across the continent.
