12th September, 2021
Nigeria has been heeding the call of the growing demand for financial services providers to provide fintech solutions for convenience.
The advent of fintech
Taking a much broader and continental view of the advent of fintech in Africa, reports claim that this particular sector is experiencing significant growth.
The evidently increasing interest in fintech has sparked a new wave of startups and various related offerings. Moreover, the world at large has been gradually moving to technology-based solutions for operations, particularly following the global conditions of 2020.
In Africa, the number of active startups in fintech has reportedly increased by 89.4% between 2017 and 2021, and were fast approaching the 600 mark at the end of June.
Although there was a drop in fintech in the past two years, relative to the years before, there was still an increase in fintech activity but at a slightly lower rate.
Commenting on the current activity in the sector, co-founder of the research company, Disrupt Africa, Tom Jackson was quoted as saying, “We might not be witnessing the same levels of explosive growth in terms of new startups launching in the fintech space as we have seen before, but instead we are seeing the increasing maturity of the fintech ecosystem in Africa.
“Startups are building out their solutions for the benefit of their customers, expanding to new markets, and raising millions of dollars in capital.
“It is an exciting time to be involved in African fintech, whether you are an entrepreneur, investor, traditional financial institution or customer.”
Nigerian financial services landscape
Zooming in on fintech in Nigeria, it seems that it has been keeping the financial services industry on its toes, as consumers have been leaning more towards making use of companies that implement fintech solutions.
Gone are the days when one had to physically go to a financial services provider’s branch to have their needs attended to, given that Nigeria’s fintech sector is said to be one that remains appealing to potential investors.
Therefore, it is safe to assume that when investing in fintech companies in this day and age, it is expected to be a step in the right direction because of how promising and potentially lucrative it is.
Financial services in Nigeria have been transformed through the implementation of fintech, with the country said to currently be one of the most important fintech ecosystems in Africa.
Despite the grim conditions of 2020, it prompted more financial institutions to adopt aggressive digital strategies and operations, which is evidenced by the reported $439 million accumulated by Nigeria’s fintech sector.
This, according to industry insiders, accounted for 20% of the capital raised by all African tech startups. Given that the continent has more than 50 countries, this is a feat worth noting.
The fintech ecosystem in Nigeria has revolutionised financial services through the introduction of blockchain and insure tech, however, regular banking and payment options remain core aspects of the ecosystem.
In an effort to accommodate its people and with an understanding of the demographics, Nigeria is striving to essentially convert people’s mobile phones into digital wallets, so to speak.
This is a strategy that is being implemented because financial inclusion remains at the core of the transformation of the financial services industry that is being phased in, through the use of fintech.