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Africa is ripe for FinTech takeover

Africa , 24 Nov 2017

Africa is ripe for FinTech takeover

KPMG's Forging the Future report describes FinTech innovation as the most disruptive industry in technology.

Banks and insurance firms are either catching the wave or pivoting their products to ensure they are not left behind in the global shift.

At a recent KPMG FinTech-focused event in Nairobi, Dorel Blitz, head of FinTech at KPMG Israel, said, "Everybody is looking at Africa. China is a closed garden - it is really hard to do anything with them. Europe, it's already there (FinTech). America is a very conservative market. In South America it will take another five to ten years. So Africa right now is the next continent and there are amazing opportunities in the African market."

"In Kenya you have over 70 percent smartphone penetration, you are a very young country - most people here are under 30 years old. So you have everything in your market really opened to provide an amazing value to financial inclusion," he added.

Blitz added that Nigeria is also a huge market opportunity for FinTech investment in Africa. "We see regulators, banks and telecom talking to each other to build this kind of ecosystem."

According to the KPMG report, over 80% of companies interviewed regarding their FinTech strategies felt that partnerships is the ideal avenue through which to engage the market.

KPMG's US$50 million partner fund with Mastercard aims to support startups that provide FinTech solutions for the market.

Wambui Chege, team leader at Fund for Rural Prosperity said that Kenya is a lighthouse in FinTech innovation.

"We give out grants up to US$2.5 million to help financial institutions and financial digital service providers develop financial solutions for small holder farmers," said Chege.

She added that there is a revolution happening in Africa around digital financial services and she hopes to see market leaders churned from the region.

"Digital is the new norm," she said.

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