Africa's fintech industry poised for rapid growth, amid regulatory headaches

Fintech is said to be the fastest-growing startup industry in Africa, thanks to changing economic dynamics across the continent such as increasing access to smartphones and internet services. However, some in the industry say there are still problems, with the massive economic potential of these innovative and disruptive new firms held back by the failure of many government's to rapidly adapt their regulatory frameworks.

From payment services, money transfer to micro-lending instruments, African innovators have stepped up to the plate to plug the inequality gap in financial services which include lack of access to mainstream banking, stoking a hotbed market for global investors, but posing new challenges for cross-border regulation.

According to a report by McKinsey, African tech startups tripled between 2020 and 2021 to hit around 5 200 companies, with half of these fintech firms. The global management consultant estimates Africa's financial-services market is set to grow at about 10% annually, reaching about $230 billion (~R4 trillion) in revenues by 2025.