South Africa is leading the boom in Fintech across sub-Saharan Africa

A number of factors are combining to make sub-Saharan Africa (SSA) the ideal breeding ground for a booming Fintech market, and countries in the region are aware of this opportunity. This is according to Global Emerging Markets Fintech Leader at Big Four accounting and advisory firm EY Varun Mittal. 

Mittal highlights that the SSA region has a substantial population, a large portion of which is financially underserved. Individuals in these regions lack links to traditional financial services avenues, often due to high costs or low accessibility. Fintechs thrive on such an environment.

This has reflected in growth of the Fintech market across the region in recent years, particularly in come key markets. South Africa, for instance, is among the fastest growing Fintech markets, not only in the SSA region but across the world. The country has come to be known as a Fintech hub in the region.

The public and private sectors alike have come to recognise this potential, and are looking to foster it in every way possible. Alongside significant regulatory support, one area of focus to develop the Fintech market is the development of the skills required to extract the maximum value from various technological applications.

South Africa has been engaged in targeted efforts to develop talent in this regard. The most prominent example of this is the penetration at the university level. The University of Cape Town, for instance, now offers a Master of Science in Data Science of Financial Technology, designed to develop Fintech talent.

“The fintech (financial-technology) landscape of sub-Saharan Africa (SSA) has experienced rapid growth over the past decade, making big impacts on the broader financial-services industry. With the combination of the conducive environment and regulatory support from governments in the region behind it, Fintech has the ability to shake up the industry further and bring about greater financial inclusion to fuel social and economic development,” explained Mittal of EY.

“Also, there is capital to be invested in the SSA fintech sector, with investments of more than US$100 million in 2017 and 2018. The increase in investment flowing into this sector aligns with its impressive expansion in recent years and accentuates its considerable potential for further growth,” he added.