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Fintech’s US$3 billion dominance in Africa should be a wake-up call for RBZ’s Sandbox

Central Bank Zimbabwe, Harare, Samora Machel Avenue, Regulators, tallest Building Zimbabwe, Reserve Bank of Zimbabwe RBZ FIntech Africa Sandbox

African fintech startups reigned supreme when it comes to attracting funding from investors. According to a report by Techcrunch, out of the US$5 billion raised by all African startups, Fintech accounted for US$3 billion. This increase is double what fintech startups were able to raise in 2020 and speaks to the appetite for innovation in the space both by the startups themselves and investors pouring money into the industry.

The heavy hitters were:

  • Nigerian payments gateway Opay which raised US$400 million in Series C
  • South African Digital Bank,Tyme Bank got US$180 million in Series B
  • Zepz (formerly WorldRemit) raised US$292 million
  • Peer-to-peer crossborder payments firm Chipper Cash raised US$250 million
  • Nigerian founded, Flutterwave which raised US$170 million in a series C round
  • Jumo and MNT Halan raised US$120 million rounds

All of this is really good to see because Africans are making some really big moves internationally. Of those listed above Flutterwave has to be the story of the year, in my opinion. The fintech firm partnered with PayPal to waive international fees for African Merchants in Q3 2021. Additionally, the company achieved unicorn status (valued at over US$1 billion) in early 2021, becoming only the fourth African fintech startup to do so.

Zim startups are forever in the terraces

These are events that Zimbabwean startups can only dream of because of the quagmire that is our local financial system. The obstacles that local fintech firms have to navigate are innumerable and this hasn’t been helped by the Reserve Bank of Zimbabwe’s Fintech Sandbox.

What I mean is that since its launch there has been scant information on how things are going. The entire premise of the initiative was to set up a sanitary environment for fintech firms to create relationships with the regulator and traditional financial institutions. This is great because we might see firms come out of there that can challenge companies like EcoCash who sorely need some stern opposition.

However, we have yet to hear anything substantial from the RBZ as to how well the program going. What opportunities has the regulator seen? Which of the 58 fintech startups who were accepted into the program have made the most strides? Are there relationships with banks and other traditional financial institutions that startups have forged and what can we expect from them? How will this whole affair affect future financial regulation?

It’s been almost a year since the central bank announced the start of Fintech Regulatory Sandbox and all of these questions haven’t been answered. From the outside looking in, there needs to be a greater sense of urgency from the Reserve Bank of Zimbabwe. The gap is an ocean wide as it is, and will continue to grow if the ideas being forged are not realised or at the very least tested.


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7 thoughts on “Fintech’s US$3 billion dominance in Africa should be a wake-up call for RBZ’s Sandbox

    1. I know the guy who started Flutterwave. A very impressive young Nigerian man, and he employs a lot of Zimbabweans

  1. Our problem as a country is our acceptance of one way traffic in terms of money movement: Bring in millions of USD bt when want your money we raise the money laundering flag

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