African fintech has been defined for decades by solving basic access problems, but the industry is now shifting its focus to innovation on top of established rails.
Tracking the growth of digital finance
Disrupt Africa partnered with AZA Finance, Revio, EMURGO Middle East & Africa, and MoneyHash to release a two-part podcast series examining the sector. The report notes that fintech is no longer just an emerging market curiosity; it is a central pillar of Africa’s tech ecosystem. Last year, Disrupt Africa’s fourth edition of Finnovating for Africa tracked 678 active fintech ventures, a 18 per cent increase from the previous year.
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The sector leads the continent for funding, a fact that has become increasingly clear since tracking began in 2015. 540 startups from 25 countries have raised an extraordinary US$3.6 billion, three times more than any other sector. While total investment has risen steadily since 2016, the last two years have seen an explosion of capital, with more than US$2.7 billion flowing into the ecosystem in just 24 months.
Shogo Ishida, co-CEO of EMURGO Middle East & Africa, which invests in blockchain solutions, describes the scale of the problem. “The current statistics presented by the World Bank say 35 per cent of individuals over the age of 14 in Sub-Saharan Africa possess a bank account – that means two-thirds of the population is without a bank account,” he said. “A substantial percentage of the population still grapples with financial exclusion, which includes mobile money access.”
Without verifiable personal identity for basic KYC, access to these services is strictly limited. This creates a vicious cycle where those outside the formal economy are penalised for their lack of data. Businesses cannot price their risk accurately, so they either refuse to serve these customers or charge extremely high premiums. Nicole Dunn, co-founder and COO of Revio, explains this dynamic. “We don’t have any data on this customer today because they consistently transact in cash rather than digitally,” she said. “We don’t give them a loan or offer them an insurance policy because I don’t have enough data to make that decision.”
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While progress has been made in basic transactional access, the availability of credit for businesses remains a significant bottleneck. Elizabeth Rossiello, co-founder and CEO of AZA Finance, notes that even established companies often struggle to secure basic working capital. “We work with companies who are doing remittances, who are making payments, who are providing NGO services, who are providing basic import export, and they can’t even get a credit line for the basic working capital needed. This is strangling the growth of the African economy,” she said.
The foundation laid by mobile money
The story of modern African fintech begins with M-Pesa. Launched in Kenya in 2007 by Safaricom, it allowed individuals to send money using only a mobile number, effectively banking millions who had never had a bank account. Ahmed Amer, co-CEO of EMURGO Middle East & Africa, views the service as a foundational infrastructure change. “It was a revolution, and it still is a revolution to this day, because it basically enabled mobile money to create financial inclusion,” he said.
While the service is revolutionary, it has distinct limitations. Elizabeth Rossiello, who originally founded the company as BitPesa, points out that mobile money is essentially a closed-loop system. “Your entire debit card system is a closed loop. You can’t pay from one to the other,” she said. This lack of interoperability and the inability to handle international transactions limits the service to domestic, low-value retail use.
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This gap in the infrastructure is exactly where fintech innovators have stepped in. The success of M-Pesa provided a dataset and a user base that attracted global investment and telecom interest. As high-speed internet spread and online commerce grew, the continent needed fintechs to bridge the gap between mobile wallets and the broader digital economy. Companies like Paystack and Flutterwave built the necessary rails to connect these disparate systems.
With those foundational layers now in place, the next wave of startups is focusing on niche solutions and value chain decoupling. The focus is shifting from “access” to “utility,” with companies optimising checkout processes, revenue recognition, and industry-specific use cases. This progression mirrors the evolution seen in other global markets, but the specific challenges of the African context—such as high exclusion rates and volatile currencies—continue to drive unique solutions.
