Fintech's Second Wave — Beyond Payments

From Inclusion to Depth: Why the Story Just Changed

For fifteen years, the African fintech story has been a payments story. M-Pesa proved that mobile money could leapfrog cards. MTN MoMo, Airtel Money and Orange Money industrialised wallets across 30+ markets. Flutterwave, Paystack and Cellulant built the rails that let merchants accept those wallets. The headline metric was *access* — how many adults could move money digitally — and on that measure, the continent has delivered: GSMA's State of the Industry on Mobile Money 2025 reports more than 1.1 billion registered mobile-money accounts in Africa, processing roughly $1.1 trillion in annual transaction value.

That era is not over, but it is no longer where the incremental revenue lives. BCG and QED Investors' landmark 2023 report — *Fintech's Next Decade: Five Themes, $1.5T Opportunity* — projected the global fintech revenue pool to reach $1.5T by 2030, with Africa as the fastest-growing region: a ~13× expansion to roughly $65B. Every subsequent BCG, McKinsey and Mastercard publication through 2024–2025 has reinforced the same directional call: the next $60B in African fintech revenue is not a payments story. It is a *financial-depth* story — credit, savings, insurance, wealth, SME working capital and cross-border B2B.

BCG calls this the second fintech wave: the move from facilitating transactions to building balance-sheet relationships with consumers and SMEs that have never had one.

The Numbers: How Fast, How Big, How Concentrated

The headline $65B figure is striking on its own, but the composition matters more than the total. Africa's revenue pool is small today by global standards — roughly 0.5% of global fintech revenue in 2023 — but it is starting from a lower base with a faster compounding curve than any other region. BCG models Africa growing at a ~32% CAGR through 2030, versus ~14% in Latin America, ~12% in Asia-Pacific and single-digit growth in North America and Europe.

The second-wave thesis sharpens this further: payments will continue to grow in absolute terms, but credit, SME, wealth and insurance will grow *faster*, capturing the majority of incremental revenue between 2026 and 2030.

The Composition Shift: Where the Next $60B Comes From

Today, African fintech revenue is heavily skewed to payments — wallet float, interchange, agent commissions, cross-border remittance fees and merchant acquiring. By BCG and McKinsey estimates, payments and money-transfer represent more than 60% of current fintech revenue on the continent. By 2030, that proportion is projected to fall to roughly one-third — not because payments shrink, but because credit, savings & wealth, insurance and SME platforms grow several multiples faster.

This is the operational meaning of 'beyond payments': payments become the *acquisition engine* and the *data layer*, while balance-sheet products (credit, deposits, insurance premiums, wealth AUM) become the revenue engine.

The Depth Gap That Makes the Thesis Work

The reason credit, savings and insurance can compound so fast is the same reason payments grew so fast a decade ago: the gap from the global benchmark is enormous, and the rails to close it are now in place.

On formal borrowing, the World Bank's 2021 Global Findex shows only 22% of adults in Sub-Saharan Africa borrowed from a formal financial institution in the prior year, vs. 56% in high-income economies. On savings, only ~15% of SSA adults save formally. On insurance, penetration outside South Africa sits below 1% of GDP across most of the continent (Swiss Re sigma). On SME credit, the IFC's MSME Finance Gap places Sub-Saharan Africa's unmet formal financing demand at roughly $331B — the largest SME credit gap of any developing region relative to GDP.

Every one of those gaps is a revenue line for a wave-two fintech.

The SME Prize: $331B of Unmet Demand

If consumer credit is the volume opportunity, SME credit is the value opportunity. The IFC's MSME Finance Gap report estimates that micro, small and medium enterprises in Sub-Saharan Africa face an unmet formal financing demand of roughly $331B — equivalent to ~17% of regional GDP. The vast majority of African MSMEs are informal, cash-based, and invisible to traditional credit-scoring models built on payslips and credit-bureau histories.

This is exactly where wave-two fintechs have a structural advantage. By sitting on payments rails — wallets, POS, payment links, agent networks — they generate transaction-level cash-flow data for businesses that no bank has ever seen. That data becomes the underwriting layer for working-capital loans, merchant cash advances, invoice finance and BNPL-for-B2B. Moniepoint in Nigeria, Lulalend (now Lula) in South Africa, FairMoney across West Africa and JUMO across multiple markets have built their loan books on exactly this insight.

Where the Capital Is Going

Venture capital flows are the leading indicator of the second-wave thesis playing out. Partech Africa's 2024 Africa Tech Venture Capital Report puts total African startup equity funding at roughly $3.2B in 2024, with fintech capturing the largest single share — approximately 40%+ of all disclosed equity funding, or ~$1.4B. The composition within fintech is the interesting part: the rounds going to pure-payments processors have plateaued, while the rounds going to credit, SME, wealth and B2B platforms have grown share for three consecutive years.

Moniepoint's 2024 unicorn round (Visa, DPI, Google), Lula's growth equity raise, M-KOPA's continued debt + equity stacking for asset-financed credit, and the steady pipeline of YC-backed African credit and savings startups all tell the same story: capital is rotating from 'move money' to 'lend money' and 'hold money'.

Regulation: The Gating Factor

The technical pieces — wallets, agent networks, payment APIs, smartphone penetration, digital ID — are in place across most major markets. What separates the markets that compound from the markets that stall is regulation. Three regulatory primitives matter most for wave two:

1. Open finance. South Africa's SARB-led open-finance discussion paper, Nigeria's CBN Open Banking Regulatory Framework (operational since 2023), and Kenya's emerging open-finance posture under CBK are the foundation for credit, savings and wealth products that can read across accounts.

2. Credit bureau coverage and alternative-data acceptance. Markets where regulators recognise alternative data (mobile, wallet, telco) for credit scoring — South Africa, Kenya, Nigeria, Ghana — are years ahead. Markets without functioning bureaux are years behind.

3. Digital ID + KYC. Nigeria's NIN, Kenya's Huduma rollout, South Africa's Smart ID, Ghana's Ghana Card and the AU's continental digital-ID push are the substrate for instant onboarding into credit, savings and insurance products at scale.

Markets that have all three move fastest. Markets missing any one move sideways.

Who Wins Wave Two — Three Archetypes

The second wave will not be won by a single business model. Three archetypes are emerging, and the best operators are blending elements of each.

Archetype 1 — The wallet that became a bank. M-Pesa (Safaricom), MTN MoMo, Airtel Money. These platforms control the rails, the data and the customer relationship. They are extending into savings (M-Shwari, KCB M-PESA), credit (Fuliza, MoKash), insurance (M-TIBA) and wealth (M-Akiba). Their advantage: distribution and trust. Their challenge: telco-led product design and slow innovation cycles.

Archetype 2 — The credit-first challenger. Moniepoint, FairMoney, Lula, JUMO, Branch, Tala. These platforms have built credit underwriting as the core competency, often without owning a banking licence. Their advantage: speed, focus and superior credit models. Their challenge: cost of capital and regulatory exposure.

Archetype 3 — The embedded-finance enabler. Stitch, Mono, Okra, Sudo, Maplerad, Bloc. These platforms sell APIs to non-financial brands that want to embed payments, accounts, cards and credit into their own products. Their advantage: B2B revenue, less regulatory burden. Their challenge: dependence on customers' growth and on incumbent partnerships.

So What? The Strategic Implications

The second-wave shift is not a soft narrative. It changes the strategic agenda for incumbents, fintechs and investors in concrete ways.

Conclusion: The Second Wave Is the Real Prize

Africa's first fintech wave was a story of access. It connected hundreds of millions of adults to a digital wallet for the first time, built the rails, and proved the demand. The second wave is the story of *depth* — turning those wallets into balance sheets, those balance sheets into credit, and that credit into compounding revenue.

The headline numbers — $65B by 2030, 13× growth, $331B SME credit gap — are large. But the real significance of the shift is operational: the next decade of African fintech will be won by the operators who can underwrite, hold and grow a balance sheet, not just move a payment. The wallet was the foothold. The credit, savings and SME stack is the prize.