Nigeria has overtaken South Africa to become the most-populated fintech space on the continent, having already established itself as the most attractive fintech investment destination.
Disrupt Africa’s Finnovating for Africa publication, released every two years since June 2017, tracks the extraordinary development of the fintech ecosystem across Africa.
The fourth edition of the report is released in partnership with AZA Finance, an African fintech company offering secure and efficient financial infrastructure for payments, foreign exchange, and settlement; and Curacel, an insurance infrastructure company that helps insurers and partners in Africa and other emerging markets increase the reach and functionality of insurance through cloud-based tools and APIs.
Meanwhile, fintech ventures have raised more than US$2.7 billion in VC funding in the last two years, having seen unprecedented growth. There has also been an uptick in M&A activity.
Much of the growth of the sector, from both an active startup and an investment perspective, is being driven by Nigeria at present. The latest edition of Finnovating for Africa tracks 217 Nigerian fintechs, up 50.1 per cent on 144 in 2021, which had in turn been up from 101 in 2019 and 74 in 2017. Nigeria’s total market share is also on the rise, up to 32 per cent from 25 per cent in 2021, and 20.6 per cent in 2019.
Nigeria has assumed a market-leading position when it comes to activity it has long held in the area of fintech investment. Of the US$3,635,823,965 in funding secured by African fintech ventures in the last 8.5 years, US$1,511,188,000 (41.6%) went into Nigeria-based companies.
Indeed, the Nigerian fintech space has added more than US$1 billion to its total in the last two years, more than tripling its total figure, and making up more than one-third of the staggering US$2.7 billion or so invested in African fintech since July 2021.
Since the publication of the last edition of this report, major rounds have been raised by the likes of Moove, FairMoney, Yellow Card, Smile ID, Nomba and Flutterwave, the latter of which had already achieved “unicorn” status in advance of our 2021 edition. Moreover, in the form of the 2020 acquisition of Paystack by Stripe, the country is also home to the continent’s most-celebrated fintech acquisition thus far.
Given Nigeria’s dominance of the market, we will not be surprised to hear of more similar success stories emerging from the country over coming years.
