Africa finds its own path for fintech development
Fintech in Africa remains the most financially supported area of tech start-up activity in the continent. The Disrupt Africa African Tech Startups Funding Report 2016 found that fintechs received a combined $31.4 million in investment during the year.
Eugene Danilkis, CEO of cloud banking platform Mambu, says there is potential for quick expansion in Africa as more consumers on the continent access modern technology. “Africa is in the early but rapid phases of fintech development,” he says. “Having started off on the payments side, it will move quickly and leapfrog to more complex financial services as smartphone penetration deepens.
“There is a big opportunity for extensive growth with a population of 1.2 billion, which will double over the next 30 years.” However, one banker at an African bank, who wished to remain anonymous, says there is a lack of fintech innovation and limited funding coming in to the continent to support a sustained level of growth. Without the development of such companies, banks are themselves looking to develop new technologies.
The pattern is the opposite of what is being seen in Europe and the US, where banks are actively financing and buying out fintechs.