AfDB Urges Increased Startup Investments In Africa

(AFRICAN EXAMINER) – African Development Bank (AfDB) has called for the scaling up of startup investments across Africa in order to grow tech entrepreneurs and enhance financial inclusion in the continent.

AfDB’s Director General for East Africa, Nenna Nwabufo gave the charge while speaking at the 9th World Financial Innovation Series in Nairobi, Kenya.

The two-day event brought together around 1,500 technology and business heads from banks, insurance, and micro-finance institutions to discuss ways of accelerating financial innovation for a digital and futuristic Africa.

Nwabufo noted that the number of tech hubs had increased dramatically, with the largest concentration in South Africa, Nigeria, Egypt, Kenya, Morocco, and Ghana.

“These centers provide space for entrepreneurs from all sectors to innovate and integrate digital solutions into traditional sectors”, she said.

She said investing in the youth is key to Africa’s digital transformation and financial inclusion, adding that the youth will drive Africa’s digital economy, the hence the need to invest in their skills development to accelerate innovations and growth on the continent.

The Bank’s East Africa director general further observed that the youth are ambitious, enterprising, and eager for change.

“Africa’s young people are the most avid adopters of ICTs and digital solutions. Recent statistics show that 60 percent of Africa’s population is below 25 years old. We anticipate a future that will be very different from today in terms of innovation, enterprise, and job and wealth creation”, she added.

Nwabufo cited Kenya’s M-Pesa, a mobile phone-based money transfer and financial service provider serving nearly 30 million vulnerable people across 10 countries, saying its services foster financial inclusion in Africa.

Others, according to her, are Airtel money in East Africa; Orange money in West Africa, AgroCenta in Ghana, which is helping smallholder farmers to access markets and finance through mobile apps, and Hello Tractor in Nigeria, which enables farmers to hire tractor services at affordable rates.

Similarly, the Chief Information Officer of ABSA Bank in Kenya, Moses Okundi noted that technology adoption had accelerated rapidly, particularly in the first two years of the COVID-19 pandemic.

Okundi however, acknowledged that there is a need to shape tech strategies to adopt “the new wave” in anticipation of future pandemics.

Participants and stakeholders at the event also underscored the relevance of forging partnerships in driving inclusion.

Chief Executive Officer of Fingo Africa, a Kenyan fintech that provides digital banking services for the youth, Kiiru Muhoya noted that partnerships result in smart solutions that can solve many of the continent’s challenges; creating technologies that can change the life of the masses,

The AfDB supports its member countries in developing national strategies to scale up digital financial service markets. The Bank is also engaging policymakers to spearhead data collection on market opportunities in digital financial services and investing funds, which focus on mobile solutions.