According to McKinsey & Co, revenues for African financial technology companies could rise to $30.3 billion by 2025 – eight times higher than in 2020 – as a growing, young, underbanked population gains more access to the Internet. Financial services revenues in Ghana and Francophone West Africa will grow fastest, followed by Nigeria and Egypt.
The expected increase is part of a rapid expansion in financial services revenue, which is expected to rise from $150 billion to $230 billion over the same period, the consulting firm said in a research report released Tuesday.
About two-thirds of Africa’s 1.3 billion people do not have bank accounts or full access to financial services, and the report said 90 per cent of all transactions on the continent are still conducted in cash. That creates a growth opportunity for fintech companies.
“African fintechs are emerging as a hotbed for investment, with average deal sizes and the share of fintech funding in Africa increasing over the past year, bringing jobs and growth to African economies,” McKinsey said. “And the story is just beginning.”
The study said financial services revenues in Ghana and Francophone West Africa would grow the fastest, followed by Nigeria and Egypt.