$50 million first Fintech-only focused Africa Fund
On Wednesday, the Kigali International Financial Centre announced its $50 million first Fintech-only focused Africa fund.
The fund is backed by MyGrowthFund Venture Partners, led by the enterprising Vusi Thembekwayo, and intends to be directed at African fintech companies that have a proven technology, for growth and scaling. This is the first of its kind in Africa, with a particular focus on fintechs across the continent. This fund highlights the growing interest and cynosure of attention that fintechs on the continent have been attracting for the past three years, with well over 50% of total investments into the continent crowded within this sector.
Without a doubt, fintech in Africa poses the greatest opportunities for investors on the continent given the massive number of the unbanked. Records show that as of 2018, over 1.7 billion adults globally were unbanked, of these stats, Africa represents a whopping 400 million. With poor road infrastructure and networks, and low internet penetration, a number of Africans are hindered from access to financial services across the continent. It is this that makes driving innovative and faster financial services avenues a cash cow for investors interested in the growing and emerging economies of Africa. The realization is that internet penetration continues its upward trend and proliferation continent-wide, the opportunities to leverage technology in driving financial inclusion become more evident, and feasible. As well, the returns in investment in this architecture and business opportunity become even more promising.
KIFC The Home of Africa’s First Fintechs Forum
The announcement was made during the Kigali International Financial Centre: The Home of Africa’s First Fintechs Forum held on the 2nd of February at the Conrad Hotel in Dubai. In a scintillating schedule of events at the Forum, topical issues around access to finance for scaling, and innovative and game-changing solutions for fintech players were the kernel of discussions at the event. Discussions also centered around health, mining and trade, with goals at crystallizing points of synergy for growth in the various sectors of the economy in Rwanda.
The forum represents a four-day trip organized by the Government of Rwanda to strengthen ties between the United Arab Emirates (UAE) and the Rwandan business environment, through leverage on trade and investment potential. As Nick Barigye, CEO of Rwanda Finance Limited (RFL) is quoted as saying,
70% of the investment deals go to tech-based products and/or services, so attracting fintech oriented investors and creating a thriving fintech ecosystem, which would facilitate scaling up investment across the continent is of paramount importance to KIFC.
The KIFC is committed to providing a conducive environment for investment and resources that are required to drive the levels of entrepreneurship and growth for Africa’s emerging fintech ecosystem.
While these represent very significant and laudable steps in that regard, there is still much that needs to be done, to ensure that the overarching goals of financial inclusion on the continent are met. These can only be best achieved through a concerted and united effort towards ensuring more access to financial services across countries in Africa. Countries like Kenya are doing quite well with mobile payments. However, more needs to be done. More than ever, governments of African countries need to look at greater platforms for the collaborative efforts of public and private institutions to ensure that Africa’s economies receive the much-sought-after boost for growth and autarky.