Africa's digital payment systems have experienced a significant transformation, with transaction volumes increasing by 37% over the past five years, according to the 2024 SIIPS Report launched in Accra on November 20, 2024. This growth highlights the continent’s evolving financial ecosystem and its embrace of technology-driven solutions to enhance financial transactions.
The report notes that 31 Instant Payment Systems (IPS) are operational across 26 countries, with 27 additional nations preparing to implement similar systems. Despite this progress, financial inclusion remains a challenge, especially for women and vulnerable groups who face barriers such as fraud risks and inadequate recourse mechanisms.
Accelerating Financial Inclusion
Dr. Robert Ochola, Chief Executive Officer of AfricaNenda, emphasized the need for collaborative efforts to expand IPS access and address these challenges. “AfricaNenda and its partners are calling for a collective push to deliver solutions that cater to every citizen, particularly those in rural and underserved areas. The goal is to ensure universal financial inclusion by 2030,” he stated.
While the value of IPS transactions has risen by 39%, issues like network reliability and security concerns persist. Fraud and privacy risks disproportionately affect women, discouraging their participation in digital financial systems. Addressing these challenges is critical to ensuring that everyone benefits from Africa’s digital payment revolution.
The Role of Digital Payments in Transformation
Jean Pesme, the Global Director of Finance at the World Bank, highlighted the transformative potential of digital payments. “Access to safe, low-cost, and efficient digital payments can transform lives, close the gender finance gap, and foster resilience. While progress is remarkable, more needs to be done through fintech promotion and private sector involvement,” he said.
The report underscores the importance of fintech innovation and the private sector's role in driving advancements in digital financial solutions. It also stresses the need for better data transparency and enhanced regulatory frameworks to support sustainable growth in digital payments.
Building a Unified Ecosystem
To achieve universal financial inclusion, the report recommends accelerating fintech licensing processes, ensuring widespread IPS adoption, and creating interoperable cross-border payment systems. These measures aim to build a more interconnected and inclusive digital financial ecosystem, fostering economic growth across the continent.
Sabine Mensah, Deputy Chief Executive Officer of the AfricaNenda Foundation, urged regulators to prioritize transparency and innovation to overcome existing barriers. "A unified approach will drive Africa closer to achieving universal financial inclusion and sustainable economic growth," she remarked.
The 2024 SIIPS Report paints a promising picture of Africa’s digital payment landscape, but it also calls for continued efforts to address the remaining gaps. By leveraging collaboration, technology, and innovation, the continent can achieve an inclusive financial future that benefits all.
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