The Governor of the Bank of Ghana, Dr Ernest Addison, has expressed worry over the lack of requisite investment in African fintech poses a significant barrier to innovation and scalability, hindering the realization of Africa’s digitization goals, as the critical issue of inadequate investment stifling the growth of fintech innovation in Africa.
According to Dr Addison, despite the proliferation of fintech and tech startups across Africa, many struggle to scale due to a dearth of funding opportunities.
The BoG Governor, said this when speaking at the 3i Africa Summit held in Accra, where he noted the detrimental impact of limited access to funding on the continent’s digital finance agenda.
He explained that while some startup founders secure funding, mismanagement, and misallocation of funds undermine their potential for growth and impact.
Recent industry data indicates a decline in startup funding in Africa, reaching a concerning 47% decline this year. This trend jeopardizes Africa’s ambitions to build a digital economy fueled by fintech innovation.
Dr. Addison in his remarks advocates for directing sufficient capital towards startups to enable them to develop viable prototypes and solutions that address Africa’s unique financial service needs.
He also emphasizes the importance of bridging the funding gap to facilitate the progression of innovative fintech solutions from concept to production.
However, Dr Addison also addresses the issue of affordability of cross-border transactions, emphasizing the need for interoperability of digital public infrastructure across the continent, and further stresses the importance of regulatory and technical harmonization to facilitate seamless trade and financial transactions across African borders.
-BY Daniel Bampoe