Strategies for Reaching Unbanked Consumers in Africa

After reviewing more pitch decks these past few days, I see African fintech founders are still flogging the dead horse that is "banking the unbanked" as a lazy fundraising pitch. From Yaounde to Cape Town, it’s the same story, another mobile wallet, payments app, another promise to bring financial inclusion to the masses. Truth is: most Africans are not unbanked because they lack access; they’re unbanked because they lack income. A new app won’t change that. The Brutal Truth Lack of Disposable Income – People don’t need more fintech solutions; they need more money. Without increased economic productivity, most “financial inclusion” solutions remain useless. Broken Unit Economics – Many fintechs rely on unsustainable VC fueled growth, acquiring “users” who don’t generate revenue. Regulatory Capture & Infrastructure Gaps – Governments protect banks and telcos dominate mobile money. The real bottlenecks are systemic, not just about "access." Startups often underestimate how slow, expensive, and political it is to scale across markets. Real Problems & Better Solutions Income-Generating Fintech – Instead of just moving money, fintech should help people make money. Platforms enabling gig work, SME financing, and export-focused businesses can drive real financial inclusion. A fintech that helps informal traders access larger markets, rather than just helping them "save." Decentralized Credit & Alternative Lending – Traditional credit models don’t work in Africa. Instead: Use supply chain data, mobile behavior, and transaction flows to build more dynamic credit models. Integrate fintech into cooperative lending structures like tontines or village savings groups, where trust already exists. B2B Payments & Trade Infrastructure – Cross-border trade needs work, killing SME growth. Fix it: Build better escrow and invoice financing tools that help African businesses transact across borders securely. Verticalized Fintech in High-Impact Sectors – Fintech should power real economic activity, not just payments. Agritech fintech: Give farmers access to dynamic pricing, supply chain finance, and better insurance. Healthcare fintech: Enable embedded payments and credit for medical services, helping people afford care without predatory loans. Logistics fintech: Provide financing for truckers, warehousing solutions, and real-time supply chain support. Infrastructure-First Fintech – If power, internet, & ID verification are problems, solve those first. Payments without stable connectivity? Build USSD-based financial services. Weak credit infrastructure? Build platforms that help lenders pool risk and share credit data across borders. The era of cheap fundraising gimmicks is over. African fintech must shift from vanity metrics to real impact, solving income generation, trade inefficiencies, and credit access at scale. I'm tired of saying this, founders who build with these in mind won’t need to beg for funding; investors will come looking for them.

I spent 2024 studying four disruptive African fintechs—Turaco, Pesapal, Kopo Kopo Inc and Chumz.io—and found common patterns in their success. These companies aren’t winning by copying Silicon Valley. They are winning by truly understanding Africa’s unique needs and solving real problems for millions of unbanked and underserved people. Here are the three patterns I found: 1. They deeply understand their customers Rather than forcing Western ideas into the market, they design solutions that fit local realities. Turaco saw that traditional insurance was too expensive for most people. So they created an affordable alternative offering coverage for as little as USD 2 a month, with claims paid in just two business days. That’s a game-changer in a market where insurance payouts takes weeks. 2. They believe in partnerships These fintechs know they can’t do it alone. Collaboration is part of their DNA. Pesapal partnered with Oracle Hospitality to simplify bookings and payments for hotels and restaurants. Chumz.io teamed up with Nabo Capital to allow users to earn interest on their savings. They make financial services more accessible by working with trusted, established names. 3. They solve real African problems These companies are building for the local markets. Kopo Kopo Inc has helped over 20,000 small businesses in Kenya processs digital payments. They recognize that small businesses are the backbone of African economies, yet they are often overlooked by traditional banks. Even their entry points reflect local realities. Chumz.io allows people to start saving with as little as KES 5. Their focus is helping people take their first step toward financial security by starting and keeping a saving habit. Fintech success in Africa comes down to understanding the market and building products that solve real, everyday problems. When you focus on serving people’s actual needs, growth happens naturally. These companies are changing how millions interact with money. And that is the kind of innovation that moves entire economies forward. PS - Follow me Ben David for more finance industry insights.

TymeBank (South Africa) and Moniepoint (Nigeria) have achieved unicorn status with valuations of $1.5 billion and over $1 billion, respectively, by blending digital banking with physical touchpoints. This hybrid model caters to Africa’s 90% cash-based economy and unbanked populations, overcoming barriers like unreliable internet and low trust in online-only systems. Together, these fintechs now serve over 25 million users, redefining what scaling financial inclusion looks like in emerging markets. SO WHAT TymeBank's partnership with supermarkets like Pick n Pay has enabled the deployment of over 1,000 kiosks and 15,000 retail points across South Africa, allowing it to grow to 15 million users. Moniepoint’s 200,000 agents, acting as human ATMs, bridge the gap in Nigeria, where only 16 ATMs per 100,000 adults exist, supporting over 10 million users. Both companies are expanding into Asia and broader African markets, leveraging $360 million in recent funding rounds to replicate their models. A digital-only strategy, like that pursued by Kuda (valued at $500 million), may be more scalable in regions with higher internet penetration and digital trust. However, it risks limiting market reach in areas where 43% or fewer have reliable connectivity. Think about it this way: the hybrid model embraces complexity to unlock growth in underserved regions. Could a hybrid approach redefine banking for other industries or regions, or is this model uniquely suited to Africa’s fintech challenges? What’s your take on scaling such a model sustainably? #fintech

Misunderstanding Purchasing Power Parity (PPP) is one of the reasons global products struggle in Africa Global companies enter African markets with one assumption… “If the product works elsewhere, people here will eventually pay for it.” No. Not because the product is bad, but because affordability is contextual. A product may look “cheap” in the U.S or Europe… But it becomes extremely expensive in an African market after currency conversion, taxes, transaction charges, and average income realities. They price globally, but consumers earn locally. I have seen companies launch products in African markets and wonder why adoption is high, but retention is poor. People can try the product, but cannot afford it sustainably. Especially subscription products. A $20 monthly subscription may look small to a foreign founder. But in some African markets, that could equal: - transport for weeks - household groceries You are not only competing against another SaaS tool, you are competing against real-life priorities. PPP affects: Pricing.   Retention.   Market perception. Even trust! Once people feel your pricing ignores their economic reality; your product starts feeling foreign instead of useful. Probably why… YouTube invested heavily in offline viewing because data affordability affects usage directly. Those are PPP decisions. Most companies try to solve this with discounts. Discounts are temporary, but PPP is structural. Here’s what smart companies do differently: 1/ Build market-sensitive pricing. Not every market should carry the same pricing structure. Some markets need: - lower entry tiers - weekly payments - usage-based pricing 2/ Reduce the total cost of adoption. Sometimes the problem is not your pricing but everything around your product. Data costs.   Device limitations.   Onboarding complexity. This is why products like Facebook Lite and YouTube Go became important in emerging markets. 3/ Localize payment behavior. African payment behavior differs significantly from card-first economies. Many customers trust Mobile Money more than bank cards. Others prefer smaller recurring payments instead of larger monthly deductions. One reason Uber introduced cash payment options in several African markets was that payment behavior differed from Western assumptions. 4/ Involve local operators in pricing conversations early. Your local teams usually understand: - spending psychology - payment behavior - trust barriers Better than spreadsheets. Many companies discuss African growth remotely while local teams only execute. Africa is not resistant to paying for value. Africans pay for value every day. Does your pricing model respect the economic reality of the customer you want to serve? Scaling globally is not simply translating your website into another language. Sometimes it means redesigning your business model around how people actually live. 📹 Crazy Kennar needs a drone ride in Uganda. 😃

Angola's $14.7B Fintech Opportunity: 19M Unbanked & Untapped Potential in Southern Africa I just completed an in-depth analysis of Angola's fintech landscape - and the opportunity is massive. Here’s what stood out: 📊 The Numbers That Matter · $8.45B digital payments market in 2024 → $14.72B by 2028 · 74.6% mobile penetration with 28.7M connections · 50% of the population still unbanked (≈19M people) · 80% of the workforce in the informal economy This isn’t a mature market. It’s a greenfield opportunity. ⚡ Infrastructure Reality Angola is a tale of two markets: ·  Luanda: 22.4 Mbps average speeds; rural areas struggle ·  Only 4% can afford 1GB of data monthly (vs 23% regional average) ·  60% of firms face regular power outages Yet, mobile connections grew 11.5% YoY - the trajectory is clear. 🎯 Key Players Shaping the Market Banking Giants: ·  BANCO BAI (5x consecutive "Best Bank" winner) ·  BPC - Banco de Poupança e Crédito , Banco BIC Angola, Banco Millennium Atlânticoântico Mobile Money Movers: · Afrimoney Angola (USAID-backed, launched 2023) · UNITEL Money (3M+ target users) · e-Kwanza (BAI’s mobile solution) Telecom Dominance: ·  Unitel: 78% market share, privatization planned 2025 ·  Africell Angola: 19% share, captured 25% within 8 months of launch ·  Movicel: 3% share, first to launch 4G 🚧 The Real Bottlenecks ·  Access to finance = #1 obstacle for 56% of firms ·  Digital literacy gaps, especially rural women (60% lack basic literacy) ·  Regulatory complexity drains startup resources ·  Economic headwinds: 25% inflation, 20%+ interest rates ·  Infrastructure deficits limit rural expansion 💡 Why This Matters Now Three catalysts are aligning: 1. Government Push: AfCFTA ratification, SADC free trade integration, Unitel privatization → more competition 2. Proven Success Models: Africell gained 5M users in under 3 years. The playbook works. 3. Regional Momentum: Africa’s fintech sector projected to hit $230B by 2025, with Angola hosting regional fintech summits 🎯 Winning Strategy for Market Entry ·  Mobile-first, not just mobile-friendly ·  Agent banking networks over brick-and-mortar ·  Financial literacy programs embedded in products ·  Partner with established banks/MNOs for trust ·  Price for the 96% who can’t afford 1GB data Bottom Line Angola isn’t Kenya or Nigeria - it’s earlier stage, infrastructure-challenged, and requires patient capital. But: 19M unbanked Angolans + rising mobile penetration + increasing regulatory support = compelling long-term opportunity. The question isn’t if Angola’s fintech sector will scale—it’s who will build the rails. What’s your take? Have you explored opportunities in Angola or other emerging African fintech markets? #Fintech #Africa #Angola #DigitalPayments #MobileMoney #EmergingMarkets #FinancialInclusion #Banking #TelecomAfrica #Innovation #Investment #Payments #MobileBanking #AfricanEconomy #TechForGood

Game-Changer for Financial Inclusion in Ethiopia! 🇪🇹 The National Bank of Ethiopia (NBE) has introduced a groundbreaking law on the Organization of Movable Collateral Registry—allowing individuals and businesses to use vehicles, machinery, inventory, livestock, and receivables as collateral for loans. This opens the door for millions of unbanked and underbanked Ethiopians to access credit without needing land or fixed property. It’s a massive win for microlending, SACCOs, fintech, and everyday entrepreneurs! But to fully unlock this opportunity, we urgently need: ✅ A National Scorecard Aggregator—credit scores based on telecom activity, banking data, salary info, and digital transactions. ✅ Incentives for the private sector—wealthy individuals and companies should be encouraged (via tax breaks, ROI schemes, or first-loss guarantees) to reinvest profits into non-collateral lending and fintech solutions. ✅ Supportive NBE policies to boost fintech innovation, licensing, and data sharing. 📣 This is the time for: Banks to partner with digital platforms. Fintechs to scale inclusive finance. Investors to treat microlending as the next big impact investment. Policymakers to lead a digital, inclusive credit revolution. Let’s turn this law into a national transformation. #FinancialInclusion #FintechEthiopia #Microlending #CreditScoring #ImpactInvestment #NBE #InclusiveFinance #DigitalLending #EthiopiaRising

Despite what you’ve been told, reaching every African isn't about building new apps. It's about understanding the tools they already use daily. In many African regions, mobile data remains a luxury. For instance, in Zimbabwe, 1GB costs an average of $43.75, the highest worldwide. Smartphone storage is another hurdle. Many devices can't accommodate multiple large applications as pointed out by Keagan Stokoe below. This limitation means users prioritise essential apps: Communication Entertainment Banking Among these, WhatsApp stands out. In Nigeria, 95% of internet users engage with WhatsApp monthly. Similarly, in South Africa, 93.9% of internet users are active on the platform. Given these constraints and preferences, integrating services directly into WhatsApp isn't just strategic. it's essential. It aligns with users' existing habits and technological realities. While there's potential to expand to platforms like Signal, Telegram, Facebook, and Instagram, our primary focus will always be WhatsApp in African nations. It's about meeting people where they are and maximising value through familiar interfaces. By embracing this approach, we ensure accessibility, relevance, and impact in every African community we serve.

Africa's Payment Revolution: The Numbers That Change Everything This map reveals something extraordinary about African markets that most foreign companies completely miss. Look at the real-time payment volumes: -Nigeria: 5.1 billion transactions -Kenya: 12 billion transactions -South Africa: 200 million transactions The Hidden Reality: While foreign companies worry about "payment infrastructure" in Africa, Africans are conducting billions of real-time transactions annually. Kenya alone processes more real-time payments than Germany (4.1B), U.K. (4B), or Japan (1.8M). What This Means for Foreign Companies: -The old assumption: "Africans don't have banking infrastructure" -The new reality: Africans have leap-frogged traditional banking entirely Business implications: -Mobile money penetration exceeds traditional banking -Instant payment capabilities in markets you thought were "cash-only" -Digital commerce infrastructure more advanced than many European markets -Consumer behavior optimized for real-time transactions The Opportunity Gap: After 100+ projects across 24 African countries, I see foreign companies still building payment strategies around assumptions from 2010. Meanwhile, African consumers expect: -Instant mobile payments -Real-time transaction confirmations -Seamless cross-border transfers -Digital-first commerce experiences Real Examples: -Mistake: European retailer insisting on cash-only operations in Kenya -Reality: Lost 60% of potential customers who only transact via M-Pesa -Success: Asian e-commerce platform integrating mobile money first -Result: 300% faster market penetration than competitors The Strategic Question: Are you building your African expansion around your payment preferences, or your customers' payment reality? The Competitive Advantage: Companies that understand Africa's real-time payment ecosystem don't just enter markets faster, they capture market share from competitors still stuck in cash-based thinking. The data doesn't lie: Africa isn't waiting for payment infrastructure. Africa IS the payment infrastructure innovation. Your move.

𝐑𝐞𝐭𝐡𝐢𝐧𝐤𝐢𝐧𝐠 𝐭𝐡𝐞 𝐖𝐚𝐲 𝐖𝐞 𝐒𝐚𝐯𝐞 𝐢𝐧 𝐄𝐭𝐡𝐢𝐨𝐩𝐢𝐚:                                    Only about 35% of adults in Ethiopia have access to formal financial services. That means the majority of people still operate outside the banking system relying on cash, informal lenders, or savings groups to manage their money. In a country of over 120 million people, this gap represents both a challenge and a massive opportunity. Mobile money platforms like Telebirr and Coopay are starting to reshape this reality. They’re not just conveniences, they’re lifelines for those who’ve never stepped into a bank branch. With a few taps, users can send and receive money, pay for services, or begin to build a financial history. These tools are creating a bridge between Ethiopia’s formal economy and the everyday lives of its citizens. But inclusion is more than just access, it’s about understanding and trust. Financial literacy remains low, particularly in rural areas and among women and youth. And even as services grow, many people hesitate to engage with them due to lack of awareness or confidence. For Ethiopia’s financial sector to thrive, it must go beyond infrastructure. It must invest in education, build trust, and tailor solutions to the realities of people’s lives. Imagine a country where a farmer in Sidama can access crop insurance, a woman in Bahir Dar can apply for a business loan, or a student in Mekelle can begin investing all with a smartphone. The foundation is there. Now it’s time to build systems that serve the whole nation. #FinancialInclusion #DigitalBanking #EconomicEmpowerment #MobileMoney #FinancialLiteracy #SmartMoneyEthiopia #TebaConnects

Too many conversations about financial inclusion assume the problem is that people are unbanked. But after spending years working directly in last-mile communities, I’ve learned something different: Fintech fails at the last mile not because people are unbanked, but because institutions can’t verify anything about them. No land records. No formal contracts. No reliable repayment history. No data trails lenders or insurers can trust. When we ran our pilot in Uganda, what stood out wasn’t the demand for credit — it was the strength of informal systems: trusted neighbors, community-held agreements, repayment promises enforced through social ties, and land-use patterns everyone locally understood. And yet, none of that was visible to formal institutions. So even if a farmer repaid consistently, or a woman entrepreneur ran a stable micro-business for years, the financial system treated them as if they didn’t exist. That gap — between real trust on the ground and verifiable trust on paper — is the barrier blocking credit, insurance, and climate resilience capital from reaching millions. At Commonlands, we’ve been building a different approach. By turning community-validated trust, land-use evidence, and informal agreements into verifiable digital certificates, we allow lenders, insurers, and climate programs to operate with confidence in places they previously avoided. Not by replacing community systems, but by making them visible. And when verification becomes possible: • Risk drops • Costs fall • Capital flows • Climate resilience initiatives finally scale This isn’t a theory; it’s what we saw in the field. The lesson is simple: If we want real inclusion, we must stop forcing last-mile communities into systems designed elsewhere and start building verification tools around how trust actually works on the ground.   Over the coming days, I’ll be sharing how this model applies across agritech, climate-resilience programs, and last-mile finance — and why the verification layer may be one of the most overlooked enablers for scaling impact in underserved markets. But for now, I want to hear from my connections working in frontier markets: What’s one assumption about African markets you wish global investors would retire? Let’s surface the real pain points.