The Sub-Saharan Africa region has become a very lucrative land of opportunities for providers of digital financial services due to the niche demographic and economic environment. The main driver to the rise of digital financial services in the region has increased by the less developed financial infrastructure and an unbanked population of 60 percent (EY market overview report, 2019). By providing access to this target segment, digital financial service providers have played a pivotal role in improving the financial inclusion of this region. The proportion of unbanked and underbanked population blended with a mobile penetration of 45 percent and internet penetration of 26 percent has laid the foundation for the expansion of Digital Payments. Statistics show that mobile subscribers and internet users will increase with a CAGR of 4.3 percent and 9.7 percent, respectively, between 2019 – 2025. An example of significant growth by digital payments can be observed in Kenya where a large mobile payment provider – Mpesa has revolutionized the idea of making payments to such an extent that 45 percent of the country’s GDP has been processed through its digital infrastructure. Looking at the fintech ecosystem, the three main hubs that form the backbone of the fintech sector in Sub-Saharan Africa are South Africa, Kenya, and Nigeria. South African FinTechs are predominantly present in both Cape Town and Johannesburg. Its focus is strategically placed on enabling FinTech segments, making the country one of the main contributors to the growth of FinTech across the continent. Kenya, the second largest FinTech hub, has a stronger focus on the payments segment. The Kenyan hub is present in Nairobi, which is home to more than 50 FinTechs. Nigeria’s FinTech sector is the third-largest hub, with most of its FinTechs based in Lagos.

Digital payment adoption has drastically increased in this pandemic as consumers preferred to stay at home due to various restrictions and merchants finding new ways of operating. E-commerce transactions in the region increased exponentially, with merchants and consumers showing a sustained preference for digital payments. The total value of e-commerce in Africa reached $16.5 billion in 2017 and is expecting to reach $29 billion by 2022. Nigeria, South Africa, and Kenya account for more than half of the online shoppers in Africa. Nigeria is Africa’s largest business-to-consumer e-commerce market in terms of both the number of shoppers and revenue.

This article presents a glimpse of the market potential of different countries across Sub-Saharan Africa. The seven countries targeted are Zimbabwe, Kenya, Nigeria, South Africa, Ghana, Zambia, and Tanzania. These countries are chosen as best markets for digital payments by evaluating parameters like: –

  • Demographics
  • Financial inclusion indicators
  • Growth vision
  • Fintech landscape


  1. 8.5 million population in Zimbabwe has an account with a financial institution.
  2. Active registered mobile money subscriptions increased by over 140 percent, from 3.19 million in March 2016 to 7.67 million in March 2020.
  3. The digital payment space is dominated by Ecocash with a 90 percent market share, with players like Telecash and MyCash trying to challenge the giant.
  4. ICT infrastructure has increased rapidly, with social media penetration growth of 32.7 percent. It can be an opportunity for digital payment players to more convenient, safer, and cost-effective payments via social media. Also, social media platforms can help digital payments service providers to initiate promotional campaigns and rewards to attract more customers.
  5. Zimswitch is the national switch with 19 commercial banks integrated with it. Also, the product line includes 700+ POS terminals and 400+ automated teller machines.
  6. Around 4 Million Zimbabweans live abroad, and the remittances sector constitutes 7.8 percent of GDP. South Africa has the largest no. of Zimbabweans.


  1. 81.6 percent population has an account with a financial institution.
  2. High poverty in rural areas even though the urbanized population has nearly full access to financial inclusion. Most people in rural areas are unable to bear the transaction costs of traditional banks.
  3. ICT contribution towards GDP was increased by 13 percent from 2017-2019.
  4. Lending and payment firms form a big chunk of fintech in Kenya.
  5. The five pillars of the digital economy in Kenya are Digital government, Digital business, Infrastructure, Digital skills, and Innovation-driven entrepreneurship.
  6. As of 2020, cash was the primary payment method used in online retail in Kenya, accounting for 40 percent of the total share. Payments by card represented 25 percent of the total online payments. Additionally, further data on payment methods shows that credit cards and debit cards; are accepted by most Digital Platforms in the country.


  1. Major focus on women, MSMEs, youth, and rural populations, that are vulnerable to financial inclusion. Mobile wallets emerged as an alternative to the traditional way of banking to address them.
  2. High mobile penetration and cheaper mobiles created an opportunity for mobile wallets like Paga and Mpesa to cater to the unbanked.
  3. There are six broad FinTech segments in the country, supported by an ecosystem of enablers. Payments, Mobile Money, and Lending jointly constitute 60 percent of the FinTech population.
  4. Nigeria has become an increasingly cashless economy mainly due to the regulatory drive for financial inclusion promoting growth in digital payments (the volume of e-payment transactions was 366 million in Q1 2020, up 57 percent from 232 million in Q1 2019).
  5. Poor user experience on traditional payment products has been a driving factor for FinTech adoption, especially among younger digital-savvy demographics.

South Africa

  1. The Country consists of a dual economy – a formal sector consisting of an urban population and has reasonable access to a formal financial institution and an informal and underdeveloped sector called rural economy.
  2. The total no. of digital commerce users is predicted to reach 33.4 million by 2025. E-commerce penetration as of 2020 is 37 percent.
  3. There are a higher number of Fintechs in SA than in any other country. SA fintech industry is focused on: payments, deposits and lending, capital raising, investment management, and market provisioning.
  4. The SMEs sector is still underdeveloped in the region.
  5. Even if the economy has 70 percent bank accounts, 50 percent of its users still use cash.
  6. South Africa has a well-developed National Payment System (NPS) with banks, non-banks, clearinghouses, system operators, and third-party payment providers, all contributing to the sector.


  1. Ghana has been acknowledged by the world bank as the fastest growing mobile money market.
  2. 57.7 percent population has an account with a financial institution.
  3. The number of active registered mobile money accounts and agents increased by 10.7 and 25.3 percent from 2018 to the end of 2019.
  4. The main focus areas are G2P payments and last-mile agent banking.
  5. Government seeks to cut down operational costs that they incur from traditional methods of banking and payments and increase their revenue by the inclusion of more customers for G2P and P2G payments.
  6. The government aims to push financial inclusion from 58 percent now to 85 percent in 2023.
  7. Digital commerce ramping up due to government initiatives like Ghana online mall, digital marketing, and made in Ghana mall.


  1. Adults with an account in the financial institution and mobile money constitute 46.8 percent and 38.5 percent, respectively.
  2. In the Digital Commerce segment, the number of users is expected to amount to 14.2 million users by 2025.
  3. The mobile money sector in Tanzania, dominated by two providers, namely Safaricom’s M-Pesa and Tigo Pesa.
  4. There is a low level of digital penetration in Tanzania, with an internet penetration of 25 percent. Digital Tanzania program, ICT policies are established to improve digital penetration.
  5. Traditional banking causes high transactional costs that become expensive for the rural population.
  6. In Tanzania, the fintech sector is still nascent, with less than 50 companies, among which 68 percent are in their early stages, and 20 percent are still at the pre-startup stage and not fully launched.
  7. Despite the rapid growth of digital financial services, financial inclusion is high – rural areas, youth, women, and smallholder farmers.


  1. Active digital finance accounts now represent 44 percent of the adult population compared to 2% in 2014.
  2. Mobile money account penetration stands at 27.8 percent. Incentives for agents and giving them the tools to manage their balances and grow their enterprises together has led to a remarkable increase in the touchpoints for mobile money.
  3. SMART Zambia sets a target of having 180 government services online.
  4. Currently, Zambia is among the top 10 least developed countries for e-government.
  5. There are at least 25 fintech developing solutions across sectors, ranging from Financial Services, Pay-Go Solar, Health, Education, Agriculture, and many more.
  6. E-commerce is limited in Zambia – Weak physical addressing, expensive logistics, limited access to the internet and smartphones.
  7. As of 2018, 91 percent of Zambian consumers are allowed to pay with credit cards. 18% of the platforms could receive customer payments from bank accounts.


With its young, growing, and tech-savvy population, Sub-Saharan Africa is well-positioned for businesses looking to add value. In the longer term, as FinTech firms innovate and become more established across the continent, the ‘teething troubles’ around payment processing will continue to be addressed.

For example, the key players in Africa’s payment ecosystem are finding more ways to unite multiple banking processes, technologies, and systems. A good example is the Nigeria Interbank Settlement System (NIBSS), helping banks come together, to remove bottlenecks associated with interbank funds transfer and settlement. There’s also Flutterwave, whose payment gateway system allows businesses to accept various payment methods including, Local Bank Payments and International Bank.

Looking at the ongoing development in technology and innovative payment solutions making their way in the Sub-Saharan market, it is just a matter; of few years for the region to become a powerhouse in the Digital Financial Services sector.


  • EY report – Fintechs in Sub-Saharan Africa – An overview of market development and investment opportunities (2019).
  • FSD Africa report – Zimbabwe fintech ecosystem study (2020)
  • Accelerating digital transformation in Zambia
  • Deloitte – The future of payments in South Africa (2019)


Aakar Shivankar, Assistant Manager, Business Consulting, Digital Financial Solutions

Aakar Shivankar has two years of work experience in diverse domains, starting from New Product development to Business Consultant. His responsibilities included creating strategies for Business expansion with the help of Market research, Analysis and strategic frameworks. At Comviva, he is working as a Global Business Consultant for the digital financial services portfolio. His role primarily demands identification of the underlying needs of organizations globally and help them to evolve their business continuously.



Comviva is the global leader of mobile solutions catering to The Business of Tomorrows. The company is a subsidiary of Tech Mahindra and a part of the $21 billion Mahindra Group. Its extensive portfolio...