Why Africa’s Fintech Market is in Motion

Africa’s fintech market is one of the most fascinating stories in global finance today. From the rise of mobile money to booming digital-first startups, the continent has found an alternative to traditional banking models and brought millions of people into the money economy. With Africa's young and mobile-savvy population, fintech has become more than just a service. It’s a driver of inclusion, innovation, and economic growth.

But to understand where the fintech ecosystem is headed, we need to trace its roots, examine the challenges, and get down to the bottom of why global investors sometimes hesitate. 

Financial inclusion in Africa

Africa is home to nearly 1.5 billion people, yet according to the World Bank’s 2021 Findex survey, about 45% of adults remain unbanked. While progress has been made in expanding access, this still leaves hundreds of millions outside the formal financial system. With high operating costs, sparse physical infrastructure, and tight margins, traditional banks have often limited their focus on low-income customers and micro-enterprises, as serving these segments can be costly and risky under strict regulatory requirements.

However, some banks have begun adapting through branch-light models, digital channels, and agent networks, showing that the gap is not solely due to neglect. Fintechs stepped in to complement these efforts, using mobile-first models and alternative data to reach people historically excluded from formal finance, expanding access in ways traditional banking alone struggled to achieve.

The role of mobile money

Mobile money has been a major driver of this progress. In Sub-Saharan Africa, 40% of adults in the region had a mobile money account in 2024, up from 27% in 2021. This surge contributed to the rise in financial access - with overall account ownership, be it a traditional bank account or mobile money provider, growing sharply from 49% to 58% in the same period. For many, it’s their first and only gateway into the formal financial system, allowing people to bypass traditional banks altogether.

The launch of M-Pesa in 2007 provided a foundational example of fintech’s potential in Africa. Let’s take the example of a farmer in a remote village. Before M-Pesa, selling a harvest meant carrying large sums of cash, risking theft, and often traveling long distances to a bank. With M-Pesa, they could receive payment instantly via their phone and this not only improved safety but also allowed them to send money to family or pay for supplies immediately. 

Today, Africa leads the world in mobile money adoption. The foundation built by M-Pesa and other players created trust, enabled commerce, and gave millions their first experience with digital finance. That first wave paved the way for the more complex financial services that followed.

Africa’s fintech future through alternative financing

Africa’s fintech landscape is entering a bold new phase, one that goes beyond simple payments or basic banking access. Today’s innovators are aiming to solve deeper systemic challenges by building what could be called a hybrid financial infrastructures that unite traditional banks, fintechs, and even crypto networks. All this with the goal of delivering rapid credit to underserved small businesses while using alternative data to bring millions into the formal financial system for the first time. Across payments, lending, and data-driven finance, this second wave of fintech is reshaping how trust, capital, and opportunity flow across the continent.

Payments & Infrastructure

Companies like Yoco empower small merchants with digital payments, while the Pan-African Payment and Settlement System (PAPSS) is aiming to save millions of dollars by enabling instant cross-border transactions. PAPSS exemplifies a hybrid financial infrastructure, combining the security and trust of traditional banks with a modern digital layer that includes fintechs, mobile money providers, and even crypto-friendly platforms. By connecting both old and new financial players, PAPSS allows cross-border payments to flow faster, cheaper and more inclusively.

Credit & Lending

Startups like Rivy (formerly Payhippo) offer easy financing for clean energy solutions, tackling the power deficit head-on. As Payhippo, the company was known for approving loans in under three hours, a speed that was revolutionary for small businesses. Today, as Rivy, it continues to streamline access to capital, with the goal of providing financing and delivering assets in a matter of hours. Buy-now-pay-later models are also giving consumers flexibility in markets where traditional credit cards never took root.

Alternative Data

Platforms like Tala and Neo-banks like Branch analyze mobile usage, airtime top-ups, and even social signals to assess creditworthiness. For millions with no formal financial history, their digital footprint effectively becomes their bank statement, unlocking access to loans, payments, and other financial services previously out of reach.

What investors should be considering

For investors, African fintech remains one of the most compelling growth stories worldwide. There are numerous companies that show that resilience and profitability are not just possible but already happening. These players prove that when fintechs tap into real economic opportunities to solve real issues on the ground, they can build sustainable businesses at scale.

Yes, the ecosystem is still young. Regulation can be fragmented, currencies volatile, and political shifts unpredictable. But these are growing pains, not deal-breakers. The very fact that fintechs thrive in such environments highlights their adaptability. Instead of waiting for perfect stability, investors can see opportunity in the foundations already being laid in mobile-first adoption, hybrid financial infrastructures, and proven demand for credit and payments. Africa’s fintech future is built on solving daily problems for millions, and those fundamentals remain solid. 

Africa’s fintech playbook 

What’s remarkable is that Africa’s fintech playbook isn’t just local. There is a uniqueness in the fact that it’s now exportable. Because the continent lacked deep legacy infrastructure, fintechs built models that are lean, mobile-first, and deeply tied to user behavior. These models are now influencing global finance.

• TymeBank has expanded into the Philippines and Indonesia.

• Flutterwave and Chipper Cash are processing payments beyond Africa’s borders.

• Moniepoint has launched in the UK.

  
  

The very constraints that forced African fintechs to innovate - fragmented regulation, underserved markets, and limited trust in institutions actually mirrored challenges that are also being experienced in other parts of the world. We’re seeing solutions born in Lagos or Nairobi that are now being studied in London and Jakarta. 

Building reputation to scale globally

To expand beyond Africa, fintechs must build a reputation that earns trust and credibility worldwide. Reputation signals reliability, governance, and the ability to deliver in complex markets. By learning from global brands, companies can adopt best practices in transparency, communication, and customer experience, turning local success into international recognition and opening doors to investors, partners, and new markets.

Conclusion

Africa’s fintech journey is still young, but its trajectory is unmistakable. From the first mobile money transaction to billion-dollar digital lenders, the continent has built solutions that are as socially transformative as they are commercially viable. Yes, capital still isn't where it could be. But the shift toward resilience, profitability, and human-centered innovation shows that Africa isn’t waiting for validation. It’s already proving itself, both at home and abroad.

For investors, the opportunity isn’t only in the technology, but in the people who power it. Those who bring capital, partner with regulators, and back human potential will find not just returns, but a role in shaping the next chapter of global finance.

Is your business prepared for the global stage? Let's find out