Mastercard has released a new study looking at fintech across the African continent and highlights some of the key numbers regarding this space during 2021 that make it such an exciting prospect.
The study was recently released as a white paper at Mobile World Congress (MWC) Africa, where fintech startups in Africa grew 81 percent in 2021.
Titled The Future of Fintech: Rapid Growth Attracts Smart Capital, the study unsurprisingly cited South Africa, Nigeria and Kenya as the fintech hubs on the continent, which makes sense given most of Africa’s top performing startups, as well as investments, come out of these regions.
Some of the other key findings from the study look at how the fintech sector accounted for 27 percent of the record-high number of deals closed across Africa, along with 61 percent of the $2.7 billion deployed across the continent in 2021. Added to this, the fintech sector yielded mega deals of more than $100 million each.
While this impressive growth could be put down to ingenuity and drive within this specific sector, as the white paper points out, much of the success found in these early stages is the result of trying to negotiate long-entrenched hurdles.
“The white paper went on to find how fintech innovation in Africa has been driven by the need to resolve multiple pain points, with a focus on increasing financial and digital inclusion. South Africa, Nigeria and Kenya were also seen as among the countries leading the transition to digital payments, with infrastructure and policy frameworks that enable this growth firmly in place,” Mastercard notes in a press release sent to Hypertext.
“It is encouraging to witness the growth of the fintech landscape across the region, creating multiple opportunities for start-ups, scale-ups, enablers and micro, small and medium enterprises (MSMEs) to bring more people into the digital fold,” adds Ngozi Megwa, SVP for Digital Partners and Enablers, Eastern Europe, Middle East and Africa at Mastercard.
The company also notes that the boom in this sectoracross Africa is indicative of growth across the globe, with worldwide funding jumping to a new record of $131.5 billion in 2021. Looking to the future, Mastercard says the growth in fintech is only set to intensify in the coming years.
“Buoyed by demand, fintech has seen products based on multi-faceted innovation in emerging and mature economies. Providing scalable financial services using the internet, blockchain, and algorithms, fintech companies have widened the reach of financial services traditionally offered by banks, including loans, payments, investments, or wealth management,” the company enthuses.
