Empowering Fintech Startups is Vital for Africa’s Prosperity

An innate ability to understand the market’s most pressing needs, coupled with a laser-sharp focus on solving the African continent’s challenges, is at the heart of our work to support Africa’s fintechs.

Article by Mark Elliott, Division President, Sub-Saharan Africa (SSA), Mastercard

A few months ago I read an interesting article in the Harvard Review that revealed what made African fintech startups so special, and what they could teach Silicon Valley about longevity. The writers explained that African fintechs are change-ready and that they focus on securing the market as opposed to gaining investors. They engage with communities rather than individuals and strive for government approval and acquisition of operating licences, rather than celebrating fundraising successes. 

It’s not just the way they operate that leads to success. Fintechs are creating simple solutions to complex challenges and the market is embracing their offerings because it’s what they really need. Many of the founders – whose businesses are contributing significantly to the growth of GDP at a national, and Africa-wide level – have grown up watching their grandparents, parents, and local communities struggle to achieve inclusion. This first-hand experience allows them to quickly identify areas which will make the greatest impact and to create solutions that make the previously unattainable, possible. 

The fintech landscape in Africa has been evolving at lightning speed, and the market is expected to reach $65bn by 2030*. This equates to a 13-fold increase in 2021, making it one of the world’s fastest-growing regions. On a continent where inclusion is critical for economic growth, fintech companies are disruptors who are committed to changing the status quo. By continuing to collaborate with them, we contribute to the rapid digital transformation that makes consumers’ lives simpler, convenient, and of course rewarding. 

This is why Mastercard places so much focus on helping to further fuel this acceleration. By co-creating solutions and giving fintech innovators access to our trusted ecosystem of partners, APIs, and data assets, as well as the services and tools they need to grow and thrive, we are helping them to move at pace through each stage of their journey. This enables them to further transform their bold ideas into tangible product and service offerings, thereby creating a more inclusive society.  

As part of Mastercard’s digital partnership strategy, we support fintechs in four sub-segments, including fintech enablers, payment service providers (PSPs) and gateways, eWallets, and start-ups scaling paytech. 

Our recent commercial partnership with MTN Group’s mobile money arm, is great example of how collaboration between technology partners can help to narrow the digital divide across Africa, because it will help to ensure the continued development of technology and infrastructure across the continent. It also means that millions of new customers will benefit from greater access to safe and affordable payments and remittance services. 

Mastercard’s partnership with Selcom has enabled East Africa’s largest payment service provider to scale its innovative offerings in key African markets, delivering products that enhance customers’ lives. Selcom is also a partner of Mastercard Fintech Express. 

We also partnered with EziPay to enable millions of consumers and merchants in Africa to use this Mastercard virtual payment solution. This is linked to the EziPay eWallet and provides a convenient payment gateway service to perform global digital transactions swiftly, safely, and securely, and connect with brands and businesses around the world wherever Mastercard is accepted.

Together with First City Monument Bank (FCMB) and Netplus, we have launched a contactless payment solution in Nigeria that enables consumers, merchants, and financial institutions to process payments seamlessly using Tap on Phone. This solution provides several benefits to consumers including convenience, speed, security, and accessibility, helping to connect millions of Nigerians, making their lives easier and safer. 

Valuable partnerships and collaborations with financial institutions, and governments, must continue. These partnerships enable local fintech start-ups to learn from and leverage the expertise, technology, and global networks of these key role players, helping them to drive economic growth across the continent. It is also imperative for us to ensure that these start-ups have access to funding, and we need to make it easy for founders to stay on the continent rather than moving abroad. 

Mastercard is a key player in the African fintech ecosystem, and we see immense opportunities for these partnerships and collaboration across the continent. We will continue to harness the power of technology and innovation to connect everyone to the digital economy, enabling service delivery across a multitude of sectors, which means building a more prosperous financial future for Africa, together.

*Boston Consulting Group (BCG) and QED Investors