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Africa’s fintech market defies VC downturn

African fintech is on track for another record year for VC investments, even as other markets struggle amid economic headwinds.

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Venture investments in fintech have slowed amid the downturn, but African startups in the sector could be on track for another record year.

Outsize valuations and choppy market conditions have caused investors to become more cautious when backing fintech startups. Several countries, including the US, have seen a significant drop in deal activity.

But Africa’s burgeoning fintech market is bucking the trend. So far this year, the sector has seen $1.3 billion invested across 151 deals, according to PitchBook data. By comparison, $1.6 billion was invested across 190 deals in 2021.


An increase in smartphone ownership, cheaper and more accessible internet services, and a predominantly young and urbanizing population have helped African fintech grow rapidly.

The sheer size of the market is a big draw for VCs looking for investments at lower valuations. With half of Africa’s population still excluded from financial services, according to the International Monetary Fund, fintech startups have ample room to expand.

Success stories coming from the region such as Nigerian payments provider Flutterwave—which achieved unicorn status in 2021—have given foreign investors more confidence in backing startups in Africa.

This year, a handful of mega-rounds have helped capital raised by African fintech startups match the pace set in 2021. Digital payments network MFS Africa secured $100 million in equity and debt in a round led by Admaius Capital Partners in June, bringing its Series C to $200 million. The previous month, crypto exchange KuCoin closed a $150 million pre-Series B led by Jump Crypto at a $10 billion valuation.

Featured image by Wara1982/Shutterstock

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    Written by Leah Hodgson
    Leah Hodgson is a London-based senior reporter for PitchBook covering venture capital across Europe and the Middle East. Leah graduated from the University of Surrey with a BA in international politics with French. She has previously been a radio reporter in France. She later turned to financial journalism, covering the wealth management industry. She joined PitchBook in 2018.
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