Traderoot actively monitors the environment in which we operate and has seen how the world’s economies have shrunk because of the COVID-19 Pandemic, yet the African fintech industry has continued to surge.
The African continent has seen incredible growth in the fintech industry over the past few years. The continent saw growth in terms of fintech funding, mergers and acquisitions grow from $1 billion in 2019 to $1.35 billion in 2020.
Furthermore, data shows that African fintechs have succeeded in raising more capital despite the Covid-19 pandemic. This is in contrast to fintechs in other emerging markets, such as Latin America, which saw a decline in investment during the pandemic.
It appears that investors believe that Africa is the next big fintech market to invest in.
Why is fintech growth thriving in Africa?
Africa is home to a large unbanked population of around 350 million people, accounting for roughly 17% of the total global unbanked population. The massive unbanked population because of a lack of traditional banking infrastructure has presented incredible opportunities for fintech companies in Africa. Many people simply cannot afford the fees to open and maintain a bank account, therefore, favouring cash and mobile money services.
This lack of traditional banking infrastructure has paved the way for African fintech firms to revolutionise the financial services industry. Mobile money has been thriving in Africa, with the continent boasting some of the highest levels of mobile money usage in the world.
Africa’s large unbanked population, rising smartphone ownership and relatively low internet costs are among the factors contributing to the region’s boom in fintech.
“Africa has an incredibly large unbanked population that needs access to banking services. This has definitely created a huge opportunity for new players to fill that gap,” says Brett Dungan, Traderoot Director.
How can Traderoot facilitate the growth of African fintechs?
The Traderoot Enterprise Platform (TEP) forms the proprietary backbone of our system, enabling seamless and scalable integration into legacy and emerging systems, whether at a modular level or as an end-to-end solution.
The Traderoot Enterprise Platform provides the perfect base to quickly, simply, and cost-effectively build various fintech solutions, including products like a “Bank In A Box”, or services such as Banking-as-a-Service (BaaS) or Open Banking.
TEP installations handle more than one million transactions per day, processing over $1Bn per month.
Traderoot is confident that the fintech industry in Africa will continue to thrive and disrupt traditional banking in a significant way. We’re excited to be contributing to the growth and disruption of fintechs in Africa. For more information, take a look at our products or email us at email@example.com.