In a recent report by Disrupt Africa, Africa’s Fintech startup ecosystem saw a flood of US$2.7 billion in investment over the last 24 months, which also grew by almost 20 percent in size.

Africa’s Fintech startup ecosystem continued on a growth trajectory, as Disrupt Africa tracked 26 fintech startup acquisitions between June 2021 and July 2023, compared to seven recorded between 2019 and 2021.

These notable growths are taking place across the continent, with all major markets bar South Africa posting an increase in the number of active ventures.

Egypt and Nigeria are also reportedly growing fast, with the number of Fintech companies based in those countries leaping by 66.7 percent and 50 percent respectively over the last two years.

Fintech startups continued to launch at a steady rate. Almost 40 percent of currently active Fintech ventures were launched between 2019 and 2021.

Notably, the fintech space remains by far the leader within the wider African startup ecosystem when it comes to both funding and exit activity.  Total investment per year has been on a fairly steady upward trajectory since 2016.

In 2023, Disrupt Africa identified fintech startups operating across 25 African countries, the same as in 2021. The number of ventures per country ranges from one, in places such as Algeria, Burkina Faso, and Mali, to 217 in Nigeria, which over the last couple of years has overtaken South Africa to become Africa’s most fintech-populated country.

South Africa has been the most populated market since Disrupt Africa data began but has now fallen to second, with 140 ventures. This accounted for 20.6 percent of Africa’s 678 fintech startups, behind Nigeria’s 32 percent. Kenya falls into third place with 102 companies in operation – 15 percent of the total.

Indeed, 459 (67.7%) of Africa’s fintech are located in either Nigeria, South Africa, or Kenya, a percentage share that barely differs from a 67.9 percent share in 2021 and 65.2 percent in 2019.

It is worth noting that much of the growth of the sector, from both an active startup and an investment perspective, is being driven by Nigeria at present.

Nigeria’s total market share is also on the rise, up to 32 percent from 25 percent in 2021, and 20.6 percent in 2019. The country has assumed a market-leading position when it comes to activity it has long held in the area of fintech investment.

Of the U5$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.

Meanwhile, the share of fintech activity contributed by the “big three” markets of South Africa, Nigeria, and Kenya maintained its 2021 levels, with 459 (57.7%) of the 678 startups tracked by this report hailing from one of those three countries.

This was ever so slightly down on the 67.9 percent share these markets accounted for in 2021, which was up from 65.2 percent in 2019. The 2017 figure was 74.4 percent.

Looking at the “big six” of fintech in Africa, adding Egypt, Ghana, and Uganda to the equation, these countries account for a whopping 86.7 percent of startups, up from 85.4 percent in 2021 and 81.7 percent in 2019.

— Press Release

Monday, August 21, 2023: Africa’s fintech startup ecosystem grew in size by almost 20 per cent, and saw US$2.7 billion in investment flood in, over the last 24 months, according to a new report released today by Disrupt Africa.

Every two years since June 2017, Disrupt Africa has released the Finnovating for Africa publication, which tracks the extraordinary development of the fintech ecosystem across Africa over the last few years.

It includes consideration of the regional spread and growth of fintech ventures, discussion of startup activity in various sub-sectors of the fintech industry, data on fintech startup launches by year, and tracking of funding and acquisitions in the fintech space, as well as a full list of every known African fintech startup.

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.

It reveals that the fintech ecosystem is the most-populated vertical within Africa’s wider tech ecosystem, having mained its steady growth over the last two years. Since the last edition of Finnovating for Africa in 2021, the number of startups operating in the space grew by 17.7 per cent to 678.

This growth is taking place across the continent, with all major markets bar South Africa posting an increase in the number of active ventures. Egypt and Nigeria are growing especially fast, with the number of fintech companies based in those countries leaping by 66.7 per cent and 50 per cent respectively over the course of the last two years,

While leading the way for activity, fintech is also by far and away the most popular vertical for investment within the wider African tech space. Since Disrupt Africa began tracking funding in the African tech startup space in 2015, 540 fintech startups from 25 countries have raised an extraordinary US$3,635,823,965, three times more than any other sector.

Total investment per year has been on a fairly steady upward trajectory since 2016, yet growth has been especially impressive in the last two years. The number of funded ventures has almost doubled since 2021, and more than US$2.7 billion has flooded into the ecosystem in the last 24 months.

African fintech startups are also more likely to be acquired than their peers. Disrupt Africa tracked 26 fintech startup acquisitions between June 2021 and July 2023, compared to just seven between 2019 and 2021, and accounting for over 60 per cent of the 43 such deals reported since 2011.

Download the report for free here.