According to the latest report by the world bank, 66% of the people in the Sub-Saharan Africado not have a bank account. However, the region leads the world in the number of people with mobile money accounts. While only 2% of the global population has a mobile money account, 12% of people in Sub-Saharan Africa had a mobile wallet by 2015, which percentage may have risen considerably by now. Nevertheless, the number of peoplewho do not have access to banking services is still high presenting a genuine need and an opportunity for banking technology innovation and investment. There are many reasons to invest in banking technology innovation in Africa. Here are the main ones;
Fast Growing Economies
According to the world finance, out of the top five fastest growing economies in the world, three are African countries. The informal sector is also doing well. This means that the need for banking services can only increase.
High Population Growth
While much of the rest of the world is experiencing a decline in population growth, the African population is ever increasing. It is estimated that over 1.2 billion people live in Africa. The approximate average rate of population growth is 2%. Consequently, the number of people who need banking services will continue increasing at least in the near future.
Large Consumer Base
The number of the middle class is growing in many of the African countries such as Ghana, Kenya, Nigeria, and Angola. The World Bank predictsthat 42% of people in Africa will be in the middle class by 2060. The large consumer base is reason enough to invest in African banking technology innovation.
The number of literate people in Africa is rising quickly with the majority of the population being young people who have attained more than basic education. Free basic education policies in most African countries have greatly contributed to this rise in education levels. Moreover, the young generation is techno-savvy and embraces technology banking more than the traditional banking.
Banking Technology has worked in Africa
History and experience have shown that Banking technology works perfectly in Africa. Mobile wallets are accepted in Africamore than in any other part of the world. Between July and September 2016, $10 billion was transactedthrough mobile technology in Kenya alone. Mpesawhich began offering mobile money services in the East African country in 2007 has since grabbed a substantial market share with Vodafone announcing that it had reached 25 million subscribersin April 2016.
In Nigeria, Interswitch, a fintech startup has been valued at $1 billioneclipsing other financial players in the most populous country of the continent that also doubles up as the largest economy having overtaken South Africa.
DT X is undertaking a mega banking technology innovation project dubbed Aqua Bank Banking 4.0in Democratic Republic of Congo and Moldova. The mobile banking and smart apps initiative will later be spread to 80 lower economies with the aim of providing financial inclusion to 80 million people in hard to reach areas, mostly in Africa.
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Financial Inclusion Data / Global Findex http://datatopics.worldbank.org/financialinclusion/region/sub-saharan-africa