By Drisha Kirkman, Head of Programme Management and Sustainability at Paymentology
Sub-Saharan Africa is experiencing a paradox in its financial transformation. Mobile network coverage now extends to 84% of the population, yet only 25% are actively connected, leaving a 59% usage gap.
While the connectivity infrastructure is largely in place, hundreds of millions remain disconnected from the digital financial tools with this disparity highlighting a deeper issue: access alone is insufficient to drive financial inclusion. Ultimately, the challenge lies in adoption, education and trust.
Barriers to adoption
Despite extensive mobile network coverage, 45% of sub-Saharan Africans aged 15 or over were unbanked in 2021. Low digital literacy holds back many from accessing financial services, unfamiliar with interacting with mobile financial services and harbouring concerns about security and fraud, creating further hesitation. Without education on the benefits of adopting digital banking and the extensive security measures in place, users remain reluctant to move away from physical banking and payment processes.
Beyond literacy barriers, cultural factors also play a role. Trust in financial institutions remains low in some regions, with many preferring cash transactions due to familiarity and perceived reliability. Financial literacy campaigns must address these concerns directly, demonstrating the tangible benefits of digital banking while ensuring that services are designed to meet the needs of their intended users.
The role of fintechs in driving inclusion
Fintechs are uniquely positioned to bridge the gap between infrastructure and adoption. Through novel digital financial platforms and targeted engagement, they can help drive greater financial inclusion by lowering barriers to accessing digital financial services.
A crucial starting point is education. Digital literacy programmes must be implemented at scale, ensuring that potential users understand how to initially set up a bank account and effectively navigate mobile banking platforms. Collaborations between fintechs, governments and NGOs can help bring financial education to underserved communities, increasing trust and confidence in digital financial services. One example is Sticitt in South Africa, which is partnering with schools to integrate financial literacy into the core curriculum. Sticitt is promoting financial independence; 51.2% of South Africans are unable to use a bank account without assistance, holding them back from effectively managing their finances.
Another important factor is innovation in product design. Fintechs are creating intuitive, low-cost and data-driven financial solutions tailored to the needs of those who are new to digital banking. Simplified user interfaces, voice-assisted transactions and offline capabilities can make mobile banking accessible even for those with basic mobile phones. Unstructured Supplementary Service Data (USSD) based banking solutions, which do not require internet access, have already proven effective in reaching users in low connectivity areas, addressing the 15% of the Sub-Saharan African population that still lacks access to any form of connectivity. By enabling essential financial transactions without the need for smartphones or data, USSD bridges this gap and ensures that even the most underserved communities can participate in the digital economy. Expanding and enhancing these offline solutions will be critical to increasing adoption and driving financial inclusion across the continent.
Trust-building initiatives must also be a priority, with fintechs and digital banks working to enhance security features while making fraud prevention measures more transparent. Partnering with local organisations to build credibility and provide tailored customer support will be essential in fostering confidence in digital finance.
Unlocking the benefits of financial inclusion
Addressing the usage gap is about more than just convenience, it is about unlocking economic opportunities for individuals and communities. When more people gain access to financial services, they are better equipped to save and manage their money effectively. This not only improves personal financial security but also drives broader economic development across the continent.
For small businesses and entrepreneurs, digital financial services provide a crucial lifeline. Access to digital payments, credit and business management tools allows small enterprises to grow and expand their reach. Fintech innovations, such as micro-loans and digital savings accounts, enable individuals to build financial stability without needing to visit a physical bank branch.
With digital financial services, both consumers and businesses gain 24/7 access to a wide range of financial products, eliminating the constraints of traditional banking hours and physical branch locations. In addition, digital finance expands consumer choice by offering access to a broader selection of financial products and service providers.
For governments and financial institutions, increasing digital financial adoption enhances economic stability. A digitally connected population improves the ease of distributing social benefits, facilitates better tax collection and reduces reliance on cash-based transactions. This, in turn, strengthens the financial system, making it more inclusive and resilient.
Turning connectivity into financial inclusion
Closing the usage gap in sub-Saharan Africa requires a multi-pronged approach. Digital literacy must be prioritised, ensuring that users understand the benefits and functionalities of digital financial services. Trust must also be built through transparent security measures, customer support and community-driven engagement strategies.
The mobile financial infrastructure in sub-Saharan Africa is already in place, but the next step is ensuring that people are not just connected, but are actively engaged with digital financial services. By working together, fintechs, banks and policymakers can create a more inclusive financial landscape, one where mobile banking and digital wallets are not just available, but widely adopted and trusted. The potential for financial inclusion in sub-Saharan Africa is immense and the time to close the usage gap is now.
