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Can Fintech fast-forward development in Africa?

Can Fintech fast-forward development in Africa?
People walk at the Kigali Convention Centre on June 21, 2022, the venue hosting the Commonwealth Heads of Government Meeting (CHOGM) till June 26th.   -  
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SIMON MAINA/AFP or licensors


The just concluded inclusive tech forum in the Rwandan capital Kigali has made a strong and solid case for the role that fintech can play in the development of the African continent.

Addressed by several notable speakers, including the host president Paul Kagame and Zambian president Hakainde Hichilema, the forum has highlighted the progress that technology is enabling in many African economies.

The Rwandan minister in charge of the National Treasury, Richard Tusabe outlined the importance of FinTech to the country’s economic and investment strategy.

"We’re investing in digital public goods. 90% of the country has broadband internet and 75% have phones. Collaboration and exchange of ideas between countries are crucial for countries to fast-track their digital transformation journey," the minister said.

Regulating Fintech

In a meeting of central bank governors, the role of regulation was highlighted, with regulators agreeing that there is a need to balance regulation and innovation for the benefit of underprivileged communities.

The session discussed licensing reforms that allow FinTechs to operate independently, harmonizing regulatory frameworks and promoting cross-border interoperability.

"In our experience, digital technology has been a big game-changer. One of the classic examples is M-PESA in East Africa," said Piyush Gupta, Chief Executive Officer of DBS Bank.

The Zambian president also appealed to the regulators to deliberately remote this sector because it has potential to gainfully engage the continent’s youthful population.

“Financial technology and access to finance, capital, is of utmost importance to our quest to achieve accelerated economic and social development, so we can take care of our populations.”

Women in Fintech

The Rwandan president emphasised the need for inclusive development, cautioning that development of the sector must not become a ‘zero-sum game’.

“Everyone must benefit. That is why we must do more to ensure that women are more active participants in the FinTech space”.

A panel discussing women in fintech shared a shocking statistic that only 1% of the people in the sector are women.

"For more women to come into fintech, they need to identify a need because fintech is always built to solve a problem. So we need to have women who will come forward and say, Oh, I wish this service existed. How can I create it?," Dare Okoudjou, the CEO of MFS Africa, said when asked about the gender disparities in the sector.

Rwanda's First Lady Jeannette Kagame also made a case for women in the sector, arguing that it is their 'legitimate right' and that 'by limiting the space for women in Finance and Technology, we are not just failing women: we are failing everyone'.

Fintech across borders

Tommaso Mancini-Griffoli, Division Chief in the Monetary and Capital Markets Department of the International Monetary Fund, highlighted the importance of changing the perception of public goods.

“We need to think about expanding our view of public goods. As we transact across borders, we are not just moving value, we are moving information. We, therefore, need to look at compliance and privacy.”

Kagame also called for greater cooperation between nations, noting that “a persistent challenge is Africa’s unharmonized regulatory environment. It affects the speed at which African FinTechs can scale.”

So far, Africa FinTech Network and FinTech Association of South Africa have announced their move to work together and advance the Fintech Ecosystem in Africa.

Elevandi, the co-organiser of the Inclusive FinTech Forum and a non-profit set up by the Monetary Authority of Singapore (MAS) also signed an MOU with the Qatar Financial Centre to collaborate on ecosystem development projects that build the community and industry sectors.

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