The assurance and convenience surround the Fintech industry, gradually is been well seated in society. People have come to understand and appreciate the importance of the industry and how it can aid human lives and development. Financial technology (Fintech) breaks down many barriers in society, helping consumers, companies, business owners manage their operations better and faster, improving and automating the use and delivery of finances.
The Fintech system materialized in the 21st century, its presence was known more in the financial institutions they usually used the system as the back end systems to run finances, however the whole system has shifted to a more consumer focus bases where different sectors have adapted to the system sectors include health, education, non-profit and above the business fraternity
Traditional Banking at risk or not
The other aspect of the Fintech is the use and development of cryptocurrencies such as bitcoin. Although the cryptocurrencies have not gained enough grounds in Africa usually carrying controversies around it, the usage and understanding of digital money is fully appreciated thanks to the accessibility of smartphones, and revolution of internet the Fintech has become more than a business it has become a part of society; for personal and commercial finances as it keeps growing explosively. Fintech has a variety of branches attached to it; they include money transfer using smartphones, doing full-blown transactions, cryptocurrency, etc. The story of consumers going to the bank for financial aid through their accounts or other banking means has speedily reduced as Fintech allows a consumer to access almost all finances through their phones.
With such development, the traditional banks, in order not to lose their relevance, have moved towards a fully-fledged, all-service digital or e-banking system in the region. It is good news that entrepreneurs in Africa have taken full control of the industry. Creating homegrown companies in the industry.Reports clearly show how African entrepreneurs have taken charge of the sector, which is quite remarkable.
Some of these homegrown companies doing very well include M-Pesa, Kenya’s first mobile wallet launched in 2007. The platform allows seamlessly transfer of funds through the use of SMS this does a lot of good for people in the rural areas cutting down the risk of sending money physically to people especially through transportation and also empowering people who never had bank accounts to receive and send money.
There is also Flutterwave from Nigeria with their product Money wave. This platform allows one to send money across Africa to any bank or digital wallet, these systems do not need to go through the hustle of bank management, cutting down the inaccessibility of traditional banking to some of part of society as well as increasing safety in society. People now do not carry huge sums of money on them, which often leads to armed robbery attack, everything is on their wallet.
There are many more of such platforms and are steadily gaining ground in the continent and globally
Booming sector for Africa entrepreneurs
The fintech industry is not only helping individuals, but the system is also building the nation’s economy, through employment and entrepreneurship. The industry growth breeds the outbreaks of jobs by homegrown firms. Young people are exploiting all there is it to Fintech coming up with innovative ideas, attracting huge investments worldwide. It is quite surprising that exponential growth of fintech is not pointed to the direction of the USA, UK, or Europe but rather Africa
This system has opened massive internet penetration in Africa, eight years ago, internet penetration was 13.5% but today it is 35.9%. Although this figure is below the world average, the growth gap between then and now is quite massive.
Internet World Statistics reports, in Kenya internet users were 2,00000 in the year 2000 but it shot up 19.6million in 2018. This rapacious appetite for internet usage has birthed many activities including entrepreneurship, which largely boosts the region’s economy.
Africa’s fintech sector is a potential game-changer, its fast pace growth, sprouting new startups and flooding of massive investment tells a clear story of how the sector would be in the next few years. Fintech in Africa is one of the world’s greatest technology success stories, the next phase is unknown but one can tell it is huge and not be underestimated. Young people should grab all the opportunities there is to this industry and soar high with it.
Article from AFRIC Editorial
Photo credit : google image/illustration