Artificial intelligence (AI) and stablecoins could help address Africa's longstanding payments and financial inclusion challenges, but fragmented regulation risks slowing adoption, according to executives at Yellow Card.
The comments were made during a media breakfast in Johannesburg, where Chanal Subramoney, Group senior compliance manager at Yellow Card, and Trevor Goott, head of growth for SADC at Yellow Card, discussed AI governance, digital assets, cross-border payments and financial inclusion.
They said clearer regulation and stronger AI governance will be essential if digital finance is to scale across Africa.
Subramoney said AI governance has evolved beyond a technology issue into a business and compliance priority, as financial institutions increasingly use AI for customer onboarding, transaction monitoring and risk management.
"What's actually getting shut down is ungoverned growth. Governance compounds growth," she said.
Yellow Card, a stablecoin infrastructure and payments provider, operates in more than 20 African countries, facilitating stablecoin transfers, treasury management and cross-border payments.
Subramoney said regulation and compliance are central to the company's operations and partnerships with financial institutions.
She said Yellow Card uses AI to support customer onboarding and transaction monitoring by identifying activity that differs from expected customer behaviour and flagging potentially suspicious transactions.
However, she said AI governance, data protection and financial compliance must work together rather than operate as separate functions.
She added that companies deploying AI for credit assessments and risk scoring should ensure systems are explainable, auditable and subject to human oversight.
"With an automated decision that's made and directly affects a client, they have the right to have that decision explained to them," she said.
Subramoney urged organisations to establish governance frameworks before regulations are fully implemented and to demonstrate that controls operate effectively in practice.
Stablecoins gain traction
Goott said stablecoins could help reduce the cost, delays and complexity of cross-border payments across Africa.
"From a payment standpoint, I think the use of stablecoins as a tool is going to continue to grow, particularly in a lot of African countries," he said.
Stablecoins are designed to maintain a stable value against an underlying asset, such as the US dollar, providing faster settlement and an alternative to traditional banking rails for some cross-border transactions.
However, Goott said regulation must balance consumer protection and financial crime prevention with innovation. Excessive regulation, he warned, could push users towards less-regulated decentralised finance platforms.
He added that regulatory fragmentation remains a major challenge for fintechs operating across multiple African markets.
Subramoney said Yellow Card applies group-wide compliance standards while adapting to local regulatory requirements.
Goott urged African governments to develop policies for emerging technologies more quickly.
"Technology goes faster than the policies which are created," he said.
He said policymakers should introduce frameworks that encourage innovation while providing appropriate safeguards.
Goott also said AI could improve financial inclusion by using alternative data to assess creditworthiness, helping individuals and small businesses without formal credit histories access finance and participate in cross-border trade.
The opportunity is not necessarily about inventing new technologies, but applying existing technologies to solve problems specific to African markets, he said.
Subramoney concluded that AI should support, not replace, human decision-making, with oversight remaining essential for compliance and risk management.
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