Africa’s financial underdevelopment has been the biggest barrier to accessing key financial services for citizens and businesses. Deficiencies in electricity generation, internet access, political instability among many factors have stifled access to much-needed capital for economic growth.
Surprisingly these very same material conditions that have burdened our continent, now create the perfect environment for a rapidly rising Fintech economy. An underdeveloped financial system has created a vacuum, necessitating alternative methods to access essential financial instruments like payment services, money transfers, credit, loans, etc.
Founded in 2019, Kashat is an Egyptian microloan Fintech. Successfully raising $1.57 million in its latest funding round, regional investor Cairo Angels and Launch Africa led the fund. Through its user-intuitive mobile platform, Kashat provides nano financial services currently in the form of small loans for the unbanked and under-banked demographics in Egypt.
Africa's Fintech sector has seen exponential investment over the years. Other notable investments include $200 million raised by Wave. A Senegalese startup that provides cashless transaction solutions. Wave netted the largest Series A funding in the region. Nigeria payment startup Opay, raised a record $400 million in Series C funding. Nigerian headquartered payment gateway company Interswitch, saw a $200 million capital injection by VISA, in exchange for 20% equity in the company.
Founded by Ugandan Ham Serunjogi and Ghanaian Maijid Moujaled, Chipper Cash, a cross-border money transfer startup raised $100 million in Series C funding led by SVB Capital.
The volume of Fintech investments on the continent indicates a clear need for financial services by citizens and businesses. The popularity of digital banks over traditional banking and financial institutions is evidence of the unbanked wanting affordable and accessible alternatives. The increase of mobile headset penetration and new technologies has created a fertile ground for an African Fintech sector.Share this via: