I work in digital finance. Since 2015, I’ve been focused on the ecosystem in Africa, launching four products and one marketplace. It’s clear that digital lending will continue its phenomenal growth in Africa. This has the trajectory of the Chinese explosion in credit over the last 15 years. In Africa, it’s the easy access, fast transaction times and private aspect of the products appeal most to customers. Even if products haven’t evolved much in the space, they still continue to meet the needs of their users. Customer’s don’t yet need full banking services on their phones, but it’s clear that banks need digital lending services for their customers. And banks are behind the curve on that. It’s been mostly startups that have carved up the space in Africa. Companies like Jumo, Zoona, Branch and Tala are all far ahead of the leading banks.
These companies are building economic moats through products that would take the banks years to put together. They are developing insights and intellectual property that is unparalleled at banks. If you consider what the Chinese fintechs are raising vs what the African fintechs are raising it looks like the African players are still undervalued. China is a massive market, and Africa is many different markets, but the fintechs here are cracking those markets, and that’s just making them more anti-fragile. I think we will start seeing some fintechs from Africa move East and be successful before we see the reverse happening. That’s a bold bet, but I’m willing to stick by it.