Analysing emerging markets, AstroPay revealed that Africa has seen a drastic surge in the presence of payment providers, but is yet to unleash its full potential due to operational discrepancies across the continent.
In an interview for SBC Leaders, AstroPay CEO Mikael Lijtenstein outlined that each country sees transactions in a different way, which has been the main factor for a slowed down progression within Africa.
He said: “Despite huge investments into the industry over the years and the presence of big players working to shape its infrastructure, the longstanding narrative is that the space is still heavily fragmented.
“Having different payment options in each country, and the difficulty of handling online transactions in different currencies, complicate the processing of digital payments in the continent.”
Placing a heightened focus on the continent, the AstroPay CEO gave several examples of how African countries are doing payments differently: “In Ghana, for example, users can pay with MTN, AirtelTigo, Vodafone, or from a bank account. Kenya on the other hand, is highly driven by mobile money, while in Nigeria bank transfers are more common.
“The challenge for merchants that want to expand their business to the region is to be able to provide each of these options per country,” Lijtenstein added.
Mentioning AstroPay’s experience in both Africa and more mature markets and what it has shown so far, Lijtenstein noted that each region has its own specifics that it has to take into account and work with them, rather than looking for a solution somewhere else.
“It is about countries finding the solutions they need for their citizens. The realities of emerging countries are very different from those of developed ones, so it is not always possible to adapt the same practices.”
Internet penetration is still a hurdle for the fintech sector in Africa, although the continent has seen significant improvements in the field.
“On several market growth telecommunications parameters, the continent has recorded the highest growth rates globally,” Lijtenstein said.
“However, while the growth figures are impressive, a stark digital divide remains. An estimated 900 million people are still not connected to the internet, and for those who are connected, connectivity prices remain mostly high, and bandwidth is severely limited in many areas.”
Despite that, Lijtenstein and AstroPay believe that with its predominantly young population that holds a large number of mobile users, Africa is on the right path to becoming on par with the largest fintech markets out there.
“Fintechs have become agents of democratisation for the unbanked populations, making it possible for them to pay online on international sites,” he concluded by highlighting the importance of the industry.
As part of the Payment Innovation track at SBC Summit Barcelona 2022, emerging markets will be a hot topic amongst delegates from over 95 countries, all joining together for a detailed discussion at the magnificent Fira de Barcelona Exhibition Centre. For more information and how to register, visit the SBC Summit Barcelona website.