Africa's fintech sector has experienced remarkable growth, with the number of companies more than doubling from 2020 to 2024, and early-stage funding rebounding significantly in 2025, raising $1 billion in the first half alone—a 40% increase from the previous year.

Projections suggest that Africa's fintech industry will generate $230 billion in revenue by the end of 2025, largely driven by digital solutions catering to underserved communities.

In 2024, fintech accounted for nearly half of all startup investments in Africa, raising $1.4 billion, with seed-stage companies responsible for 69% of deal volume, despite securing only 22% of total equity funding.

Local funds play a crucial role in the fintech ecosystem, as they possess a better understanding of regional dynamics compared to international investors, highlighting the importance of local ownership and investment.

Despite the sector's growth, challenges remain, including regulatory hurdles, limited local funding, infrastructure gaps, and cybersecurity threats, with only 5% of seed-funded startups managing to secure Series A funding.

Investment trends indicate a recovery in funding after a significant drop of 52% from 2022 to 2024, with a focus on payments, lending, and remittances, alongside emerging interests in wealthtech, blockchain, and insurtech.

Both local and international investors are becoming increasingly active in Africa's fintech landscape, with local funds gaining prominence and institutional investors showing renewed interest in the sector.

Major fintech funding hubs in Africa include Nigeria, South Africa, Egypt, and Kenya, although emerging markets like Rwanda and Senegal are starting to gain attention.

Noteworthy early-stage deals include Moniepoint achieving unicorn status after raising $110 million, and Khazna securing $16 million to expand its services in Egypt and Saudi Arabia.

Technological innovations, such as AI and blockchain, are enhancing operations and fraud detection, with mobile internet users in Africa projected to reach 475 million by the end of 2025.

Looking ahead, McKinsey forecasts a potential surge in fintech revenue, predicting nearly 10% annual growth from 2023 to 2028, alongside the rise of alternative funding sources like venture debt.