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Fintech market in Nigeria, Sub-Saharan Africa

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By Mercy Kelani

A shift towards digital lifestyles might foster a growth of 10% per annum.

GSMA has recently disclosed that affordable mobile connectivity, increasing smartphone ownership, influx of funding, and increasing supportive regulatory framework will aid an enhancement of the fintech market in Nigeria and across other African countries. The fintech industry, in Sub-Saharan Africa, has been enhanced by a increase in growing funding, innovative solutions, and investments. According to the global association for telecommunications firm, in coming years, the industry will improve further, as essential conditions also experience more improvements.

This disclosure was made by the association in its “The Mobile Economy Sub-Saharan Africa (2023)” report. The report predicted that a transformation towards digital lifestyles might bring about a growth of 10 percent per annum until 2025 in the fintech market in this African region. It stated that the development of the industry varies with significant difference across the Sub-Saharan African region. Although markets in Ghana and Nigeria have impressive potential, Kenya and South Africa are at the forefront.

Regional & national initiatives will foster collaboration opportunities.

Due to the growing diversion towards digital lifestyles, there is a continual emergence of regulatory initiatives in the region to provide support for fintech solutions towards financial inclusion. For instance, Nigeria, Uganda, and Ghana, have introduced programmes for the stimulation of financial inclusion and to aid a rise in digital cash transactions. The programmes introduced by these three Sub-Saharan African countries will ensure provision of encouragement for fintech stakeholders to aid innovation with new product offerings.

Also, there are some regional initiatives, like the Pan-African Payment and Settlement System, which renders support for instant cross-border payments in local currencies and had an expansion of its operations in 2022, last year. These kinds of regional and national initiatives will foster collaboration opportunities, while driving the development of digital payment networks. In the Sub-Saharan African region, payments and wallets ought to be products with the fastest-growing pace. There is continuous growth in fintech services.

There is the growth of online financial services.

The growth has ensured that mobile operators like Airtel and MTN Africa are looking farther than basic connectivity to going into the fintech space through enhancement of mobile money services, and an increase in partnerships with financial institutions and companies in the industry. The GSMA commented on other factors that are contributing to the growth of mobile financial services in Africa, saying that the increasing significance of mobile financial services in Sub-Saharan Africa has received support from a developed regulatory outlook.

Through improved regulatory outlook, new ways of development have been opened for the sector and opportunities have been presented for mobile operators to carry out expansion of services and generation of additional revenue streams. Operators, through implementation of existing infrastructure and customer data, will not cease in the creation of new value-added services for their customers. There is the growth of online financial services and the interdependence of mobile connectivity, however, 15 percent of the Nigerian and other Sub-Saharan countries’ population do not have the coverage of mobile broadband networks.

In Nigeria, 27M citizens are living in areas without telecom services.

Director General of the GSMA, Mats Granryd, while commenting on the gap in usage, stated that the mobile sector has witnessed an impressive growth in Sub-Saharan Africa. Also, the DG said that the mobile sector currently reaches about 490 million subscribers. However, only one in four people across the region have subscription to the mobile internet. According to the Nigerian Communications Commission, in Nigeria, there are 27 million citizens residing in areas without telecom services. These citizens are cut off from mobile connectivity and its benefits.

Related Link

Fintech Association of Nigeria: Website

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