Shared payment streams the future of fintech in Africa

Johannesburg, 03 Oct 2023
Shared payment streams have helped to boost financial inclusion.
Shared payment streams have helped to boost financial inclusion.

Analysts are predicting significant growth for Africa’s fintech industry in coming years, with fintech service providers (fintechs) disrupting traditional financial services and unlocking the potential of shared payment streams. These are intermediary platforms between the buyer and seller that facilitate a digital transaction.

Cash is still used in around 90% of consumer transactions in Africa, which is great news for telcos wishing to leverage shared payment streams. Existing technologies can be used to boost digital transformation for the continent’s unbanked and underbanked population.

The future will involve telcos being able to share payment streams between themselves through application programming interfaces (APIs), over-the-top (OTT) services providers (such as mobile wallets) and social media platforms, like Facebook Messenger or WhatsApp.

The future of fintech will involve telcos

Many African countries still have low levels of financial inclusion, but also experience high mobile phone penetration rates compared to other parts of the world. The mobile phone is the primary means of communication and access to information for many in Africa.

Unlike other parts of the world where there are clear lines between banks and telcos, in Africa, the line between these two industries is more merged. In recent years, telcos have branched out from only providing telephone services to offering financial services through shared payment streams. The number of African users making digital payments from their mobile devices is expected to exceed 600 million by 2027.

Shared payment streams have the potential to revolutionise the fintech industry in Africa for several reasons:

  • Inclusion: Shared payment streams can help to include individuals who are unbanked or underbanked in the traditional financial system. By leveraging digital technology, these individuals can easily access and make use of financial services without needing a bank account or formal financial institution.
  • Cost-effectiveness: Traditional banking services in Africa are often expensive and not accessible to everyone, especially in rural areas. Shared payment streams can provide a cost-effective alternative to traditional banks, allowing people to transact and make payments without incurring high fees or charges.
  • Security: Digital payment systems can be more secure than traditional cash transactions, which are vulnerable to theft and fraud. Shared payment streams can offer enhanced security measures, such as two-factor authentication, biometric verification and encrypted transactions to ensure that payments are secure.
  • Convenience: Shared payment streams can offer the convenience of making transactions from anywhere and at any time, eliminating the need for physical cash or in-person transactions. This convenience can be especially important in countries with limited infrastructure or public transport.
  • Scalability: Shared payment streams can be scaled quickly and easily to accommodate a growing number of users, making them a highly attractive solution for the rapidly expanding African fintech market.

Shared payment streams: A disruptive innovation

The African continent is home to a number of world-changing innovations that are disrupting its financial services ecosystem. M-Pesa, for example, has become one of the most successful mobile payment systems in Africa.

Allowing users to make payments, transfer money and buy goods using their phones, this technology has empowered millions of people to access financial services on their phones. Today there are more than 54 million users across Africa and the service continues to grow rapidly as more people join each day.

M-Pesa has been able to achieve this level of success because it offers convenience and accessibility – something many other platforms or the traditional banking sector cannot provide. It’s a similar scenario for other mobile money platforms across Africa.

The future of mobile money in Africa

Shared payment streams are the future of fintech in Africa. They’ve helped boost financial inclusion and drive GDP growth across the continent. In Kenya, for example, mobile money has helped lift millions out of poverty by enabling people to save and make more money through digital payments.

For telcos, shared payment streams have become a lucrative alternative revenue system to subscription fees and are expected to be a major driver of growth in the future. While other entities, like banks, would need to build up their infrastructure to provide shared payment streams, telcos are uniquely positioned to offer these services using their existing infrastructure.

The future of fintech in Africa looks bright. With innovative solutions such as shared payment streams, telcos have an opportunity to become major players in the financial services ecosystem and drive economic growth across the continent.

4C Group’s iNSight software enables enterprises to offer mobile money services via a secure and scalable payment gateway with a proven track record. For more information about our payment gateway and other fintech services, please contact us today.


4C Group

At 4C Group of Companies, we strive to effect operational changes and cost savings for customers through our iNSight product and associated services. This product’s main function is to re-purpose and deliver business-critical information to a variety of systems and stakeholders.

We specialise in information assurance, business assurance, fintech solutions and a variety of cyber security services. For more insights into our products and services, check out our blog page or follow us on Facebook, LinkedIn and Twitter.