Africa’s Biggest Fintech And How They’re Pushing Financial Inclusion

Over the years, Africa has seen a drastic improvement in access to financial services. The presence of fintech startups that provide access to financial services, and recently credit facilities, have helped broaden the scope of financial inclusion. The availability and continuous diffusion of technology, mobile money services, and endless payment and credit options have broadened financial inclusion in the continent. Before this decade, there was no exact way to measure the reach of the financial sector; there was no way to know to what extent disadvantaged groups such as women, the youth and the poor could not access financial services. This information is, however, now available. Research also shows that Africa, in this current decade, has witnessed a lot of impressive growth compared to what used to be in the last decade. Systemic indicators and researches show that although financial inclusion in Africa has broadened, in recent times when compared to other continents, there are still a lot of gaps to fill.

According to a report by the African Development Bank (AfDB), evidence shows that Africans and businesses in the continent, compared to their counterparts in other parts of the world, are more likely to lack access to financial services such as bank credit irrespective of their size group. As of 2013, less than a quarter of adults in Africa who had an account with a formal financial institution such as banks used informal methods to save and borrow money. Some of these informal methods highly patronized include credit associations formed by co-workers, members of an organization, etc., and rotating savings. They also sourced funds from friends and family.

It is interesting to say that this has changed and is still changing, thanks to fintech startups and technology. Today, accessing financial services is as easy as easy can be. According to the AfDB, in recent years, individuals now have more financial access thanks to technological advancement and innovation. Fintech, coupled with mobile money services, widespread mobile branches, and agents, roadside banking services, etc., have helped achieve all of this.

Getting to the current level of financial inclusion took a whole lot and African fintech startups have a lot to be thanked for, but before we go into that, we need to examine what financial inclusion encompasses.


What does Financial Inclusion mean?

The World Bank defines financial inclusion as the access that individuals and businesses have to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit, and insurance – delivered in a responsible and sustainable financial way. According to the World Bank, the availability of financial services is one of the most important steps to a broader financial inclusion. Fintech companies in Africa are doing a great job in narrowing the gap, as their products and services, as well as the access they provide to individuals and businesses, have helped to broaden financial inclusion in the continent.


How Africa’s biggest fintech companies are broadening financial inclusion

Statistics and research show that before the popularization of fintech companies and their services, Africans did not patronize many of the financial services provided by formal financial institutions mainly because they were not as accessible as they were made to seem. Many people use these formal institutions as means of sending and receiving money or just accessing financial services that could not be accessed anywhere.

The advent of fintech startups changed the financial space in Africa completely. A handful of reasons have made these fintech startups thrive. Fintech startups capitalize on the fact that people have phones; they provide financial products and services without any restriction, all that people need is to have a mobile phone. Formal financial institutions like banks, for instance, require people and businesses to have accounts with them before access can be granted to these financial services. These processes are usually cumbersome, requirements have to be met and documents have to be provided before access to these services can be granted.

Fintech startups just require users to have a mobile phone and an active internet connection, and access to their quite endless packages is granted.

Here are some of the ways that fintech companies have helped to widen financial inclusion in the country;

          1. Penetration and access

Africa is grossly filled with underdeveloped nations and all of them share the same problem of lack of penetration and access to financial services. Formal financial institutions do not reach many parts of various countries leaving people and small businesses in these parts with no access to financial services. Fintech companies have been able to leverage on this shortcoming of their counterparts and have brought financial services closer to people. The integration of Artificial Intelligence and Machine Learning with Big Data is helping fintech companies tap into a larger segment of the population, giving them the upper hand over banks, and other financial institutions.

          2. Credit facilities

Fintech companies provide credit facilities to people and small businesses without demanding that cumbersome requirements are met. These facilities are easy to access and can be accessed without having to go to a physical location and wait in a queue. They also do not require collaterals and provide various products and services that businesses and Africans can choose from, thus giving them independence over their credit choice.

        3. Focus is on the unbanked and SMEs

Unlike financial institutions like banks, these fintech companies target the unbanked and small and medium scale businesses. They, therefore design their products specifically for this set of people and businesses. This set of people and businesses find it easier to trust and patronize these fintech companies because of the products that have been specifically tailored to them.

          4. Many fintech companies are providing specialized services

Another reason why fintech companies in Africa are thriving is specialization. In Africa, many startups are providing numerous and different services. Each one specializes in one financial service than the other, providing users with quite a plethora of choices. Some companies specialized in providing loans, others in bill payments, and others in cross-border payments. Whatever it is, they make it easier for Africans to have access to these financial services.

           5. They provide financial education for users

Educating users about financial products and helping them pick the best choices out of what is available to them is an important issue when it comes to providing financial services, and these fintech companies do it better than formal financial institutions.



The fintech space in Africa has changed and fintech companies have driven this change. They have provided people and businesses with access to credit, effective and faster payment options, better ways of saving, better ways of spending, and a lot more. They have helped to broaden financial inclusion in the continent especially by penetrating areas and conditions that formal financial institutions would naturally abandon. Today when you move into streets and corners in the continent, it feels natural to find POS stands. These are powered by many fintech who have taken it upon themselves to go into “untouched” areas. With phones, people can send and receive money without having to move anywhere or visit a physical location. Compared to the last decade, Africa’s fintech companies like M-Pesa, Fair Money, OPay, PalmPay, Yoco, Flutter wave have helped to provide more access to financial services. There are millions of Africans using their platforms to access these financial services.

M-Pesa recently recorded 50 million Africans using its mobile money platform. Many other startups have also recorded impressive achievements, proving that the future of financial inclusion in Africa is bright.

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