The Unfolding of FinTech in Africa

The African region has been spearheading the FinTech industry with the VC ecosystem striving to bank the unbanked. We invite NowNow, a digital banking platform in Nigeria, to talk about Fintech in the region.


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Banks and FinTech in Africa

The challenges vary but most center on the infrastructural and regulatory environments. Different countries in the continent have achieved different levels of digital maturity which allows some to see more innovation in financial services than others. The lack of digital infrastructure is the major contributor to the slow internet penetration rate which also affects the adoption of financial technologies. Although the regulatory environment can be uncertain in some regions, it is also quite nascent and adapting to the growing innovation. 

I think another challenge is funding, following recent global economic realities. I don’t think that the change means there is not enough money coming in, but the utility of the money will be closely monitored. The valuations we have seen before may not be seen anymore. Things will become a little bit more competitive now that the global economy has changed. There may be revaluations. Investors will rethink their strategies and pay closer attention to the vision of the company, and this was the case with our investors.

Fintechs are not necessarily competing with traditional banks because they are working towards providing financial services to the people. The difference is that the fintech ecosystem allows for more innovative approaches than the traditional banks are allowed to.


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The rise of FinTech

 

Nigeria is spearheading the fintech industry in the sub-Saharan region of Africa not just because of its population advantage but also because of its openness to innovation. With the high number of Nigerians excluded financially, it is only natural that the fintech space received that much attention. Other tech sectors are beginning to receive equal attention in the ecosystem but are not as disruptive as the fintech services.

The Now and Future of NowNow

When we launched, we wanted to service the population underserved by traditional banking systems. Nigeria has one of the fastest growing populations in the world, and more than half of this population is either unserved or underserved financially. So, our focus was on financial inclusion and empowerment with financial technology.

The foundation that we set was creating an agency banking network which is now 50,000 agents strong. We realized that we cannot say we want to include people financially and create only cards and digital applications because this would mean including people already financially included. Today, we provide digital banking solutions through agency banking and directly to end consumers as well. We also now provide our platform and technology to several other Fintechs in Nigeria and Africa, making us an embedded finance company.

One of our goals for the capital is to expand our operations across Africa. Instead of entering multiple regions, we are focusing on select countries where we feel our services are needed. As such, we are planning to launch in Angola in Q4 2022. Liberia is also another country that we are considering because of its fractured infrastructure. We hope to launch in Liberia in early 2023. After this, we will access our operations in the region and see how we can scale sustainably. 


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