Agpaytech’s Research

19th Dec. 2024

Digital Banking & Payments Series

Telecom Retail Banking

Realities and Fintech

Shifts in Africa, 2024

Agpaytech
 Introduction
The African financial sector has undergone transformative changes over For users without
the past decade, driven largely by mobile technologies, innovative FinTech smartphones, telecom
solutions, and growing access to internet services. firms offer USSD and
SMS-based channels
Traditional banks are increasingly challenged by telecom operators and FinTech startups
that banks and
that provide affordable, scalable, and user-friendly financial solutions. Telecom firms play a
FinTechs leverage for
critical role in supporting banks and FinTechs in the electronic mobile payment systems in
transaction services
Africa, enabling broader financial inclusion and fostering innovation. Over the years, mobile
like mobile money,
money, USSD and SMS Platforms are key contributions of the Telecoms to the financial
balance checks, and bill
sector
payments.
For users without smartphones, telecom firms offer USSD and SMS-based channels that
banks and FinTechs leverage for transaction services like mobile money, balance checks,
and bill payments. Telecom companies like Safaricom (M-Pesa) and MTN (MoMo) have
developed mobile money platforms that act as foundational systems for electronic payment
services.

The platform is collaborated with banks and Fintechs to offer unlimited services 24/7 to both
the local and international users. Also, banks and FinTechs integrate with these platforms to
offer savings, lending, and payment solutions, enabling seamless transactions across
networks. We cannot place a little emphasize on mobile network coverage in Africa. Telecom
companies provide the infrastructure for mobile connectivity, allowing banks and FinTechs to
reach underserved and rural areas where traditional banking infrastructure is absent.

Figure 1: Outgoing transactions using mobile payment

60

49
50
of out-going transactions

40

30
22
20
14
10
10
%

2 3
0
Outgoing Outward Airtime P2P Off-net Bill Payments Mobile to Bank ash-out
C
transactions remittance

Source: GSMA (2024)

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 Figure 2: Mobile money live lines in Africa by region

Live services
80
70
60
50
40
30
20
10
0
West Africa Central frica Southern Africa East Africa North Africa

Source: GSMA (2024)

The Key Players Making

the Realities
Africa's telecom retail banking market is primarily driven by telecom operators and their
East Africa leads with

488 M
mobile money platforms, often in collaboration with banks and FinTechs. However, there is a
regional variation in the success of telecoms mobile money products. East Africa leads with
488 million transactions, underscoring its status as a pioneer in mobile money innovation, transactions
largely driven by platforms like M-Pesa in Kenya and Tanzania.
West Africa follows with
This region's success can be attributed to strong telecom infrastructure, early adoption of
mobile money, and widespread trust in digital financial services. West Africa follows with 347
347 M
transactions
million transactions, reflecting growing adoption in countries like Ghana, Nigeria, and Côte
d’Ivoire. Initiatives like MTN MoMo and Airtel Money are driving this growth, supported by
increasing financial inclusion efforts and cross-border transfer capabilities.

Figure 3: mobile money transaction across regions

600
488
500
Value in billion $

400 347

300

200

100 72
7 6
0
Central Africa West Africa North Africa East Africa Southern Africa

Source: GSMA (2024)

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 Safaricom (Kenya):

M-Pesa is Africa's most renowned mobile money platform, allowing users to send and
receive money, pay bills, access loans, and save through integrated banking solutions.
Safaricom mobile product popularly known as the M-Pesa. The firm has partnered with
KCB Bank (KCB M-Pesa) and NCBA Bank for services like micro-loans and savings
accounts.

MTN Group (Pan-Africa):

Provides mobile money solutions in over 15 countries, enabling services such as

remittances, bill payments, savings, microloans, and insurance. Through its MTN MoMo, it
has partnered with Ecobank to expand financial access and supports cross-border
transfers through the MoMo Pay platform.

Airtel Africa (Pan-Africa):

Operates in over 14 African countries offering domestic and international remittances, bill
payments, merchant payments, and airtime purchases. The main financial product is Airtel
Money. It worked with banks like UBA for savings and lending solutions. Airtel Africa has
collaborated with MasterCard for digital card issuance for online payments.

Vodacom Group (South Africa & East Africa):

Operates M-Pesa alongside Safaricom in markets like Tanzania, Mozambique, and DRC,
offering savings, loans, and payment services. Collaborates with banks and merchants to
provide financial services tailored for SMEs and individuals.

Orange (West Africa and North Africa):

Available in over 17 countries, offering digital wallets, payment processing, microloans,

and international money transfers in the West and North Africa regions. Orange operates
the Orange Money and partnered with NSIA Bank to launch Orange Bank Africa,
providing savings and credit solutions.

Tigo (Millicom):

Operates primarily in Tanzania, offering mobile money services, savings products, and
P2P payments. Millicom’s Tigo Pesa works with local banks to provide integrated mobile
banking experiences to customers. Among other growing players include Econet
Wireless (Zimbabwe) with EcoCash, Telkom (South Africa & Kenya) with T-kash (Kenya)
and partnerships in South Africa and Globacom (Nigeria) with the financial product Glo
Xchange with offers agency banking solutions and wallet-based mobile money services in
partnership with banks to enable savings, payments, and remittances.

Agpaytech
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04
 Telecoms FinTech

Shifts in 2024
Telecom operators are now dominant players in
Africa’s financial services sector. Using mobile
technology as a backbone, they have pioneered
models such as mobile money, which addresses
the continent’s high financial exclusion rates. In
2024, Telecom companies increasingly
collaborate with banks and FinTech startups to
deliver hybrid services.

Agpaytech 05
Dominance of Mobile Money
Platforms/Apps
Telecoms operate mobile wallets such as M-Pesa (Safaricom), MoMo In 2024, mobile money
(MTN), and Orange Money, which are integrated with FinTech platforms. penetration exceeds

This enables users to fund wallets using their mobile balance, make payments to merchants 60%
directly from mobile wallets via FinTech apps as well as cash-in and cash-out funds at agent in regions like East and
locations. Services such as M-Pesa (Kenya), MTN MoMo (various countries), and Airtel West Africa
Money have millions of active users, enabling seamless payments and money transfers.

In 2024, mobile money penetration exceeds 60% in regions like East and West Africa. Mobile
money interoperability across borders continues to improve under regional frameworks
such as the East African Payment System (EAPS). Also, several FinTech firms across Africa
have developed mobile apps to revolutionize payments.

Table 1: Notable FinTech apps, their telecom collaborations, and the features

FinTech Firm App Name Collaborating Key Features of

Telecom(s) Collaboration

Flutterwave Flutterwave
MTN, Airtel Integrates mobile money services for seamless wallet funding and
Mobile direct payments.

Paystack Paystack MTN MoMo, Supports payment collections and subscriptions by leveraging
App Airtel Money mobile wallet integrations.

Chipper Cash C hipper Safaricom

Facilitates cross-border peer-to-peer transfers via mobile
C ash (M-Pesa), MTN wallets.

Paga Paga App MTN, Airtel Offers U SS D payment capabilities for basic phone users in
underserved regions.

Opay O pay MTN, Airtel Supports wallet funding, bill payments, and cash withdrawals
Mobile through telecom agent networks.

MFS Africa B eyonic MTN, Airtel, Ensures interoperability across over 300 mobile money wallets for
O range Money cross-border payments.

Wave Wave App O range Money, Specializes in ultra-low-cost remittance and mobile payments in
MTN multiple regions.

Eversend Eversend MTN, Multi-currency wallet that integrates with telecoms to enable
App Safaricom seamless mobile transfers.

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Collaboration with Card Networks
Recently, giant card networks have collaborated with Fintechs, telecoms, MTN said that the

MTOs, PSPs, banks, etc to increase their dominance and market locations deal values the

within Africa. entire fintech unit at

$5.2
billion

Master Card, Visa, etc. are growing their presence in the African market through strategic
partnerships with Fintechs and key Telecom players in the Sub-Saharan Africa region. The
partnerships include leveraging APIs and data-sharing agreements for seamless customer
onboarding, cross-border payments and remittance services, building Fintech ecosystem,
other innovative services.

Airtel Africa and MasterCard have announced the launch of a new cross-border remittance
service, which will enable Airtel subscribers across 14 African markets to send and receive
money safely and securely, with speed and certainty.

Mastercard Inc. agreed to take a minority stake in the financial technology business of MTN
Group Ltd., Africa’s biggest wireless carrier, sending the telecom company’s stock up the
most in three months. MTN said that the deal values the entire fintech unit at $5.2 billion.

Safaricom, Kenya’s largest mobile operator, and leading digital payments company Visa
partnered to develop products that will support digital payments for M-Pesa customers.

Visa announced a partnership with MFS Africa to give millions of mobile money users the
ability to use a virtual card and other services.

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API Access
Telecom firms grant banks and FinTechs API access for integrating their payment systems One of the technologies
with mobile platforms, creating interoperability between services. For instance, MTN used by Fintechs and
provided API access to Flutterwave, enabling seamless integration with the MoMo mobile Telecoms is AI. Artificial
money platform across key African markets like Nigeria, Ghana, and Uganda. This integration intelligence (AI) has
allows Flutterwave merchants to accept payments directly from MTN MoMo wallets, emerged as a critical
simplifying the checkout process. Orange Money’s APIs were utilized by Chipper Cash to tool in revolutionizing
facilitate cross-border remittances, connecting wallets across multiple countries, including customer analytics for
Ivory Coast, Senegal, and Mali. Airtel granted Opay API access, allowing Opay’s app to fintech and telecom
integrate Airtel Money payments. This supports wallet funding and bill payments in countries companies in Africa.
like Uganda, Tanzania, and Zambia. Safaricom’s APIs allowed Paystack to integrate with M-
Pesa, enabling Kenyan businesses to receive payments via mobile money. Users can easily
link their M-Pesa accounts to make merchant and subscription payments.

Customer Analytics
Telecoms provide customer usage data, such as call patterns, recharge behavior, and
payment histories, to banks and FinTechs. This helps in developing credit scoring models
and targeted financial products. One of the technologies used by Fintechs and Telecoms is
AI. Artificial intelligence (AI) has emerged as a critical tool in revolutionizing customer
analytics for fintech and telecom companies in Africa. These industries are leveraging AI
technologies to enhance customer experiences, optimize operations, and drive financial
inclusion across the continent. In 2024, the rapid adoption of AI-driven customer analytics
tools is evident in the strategies fintechs and telecoms employ to understand their customer
base, improve decision-making, and offer tailored solutions. AI enables companies to analyze
vast amounts of customer data, derive insights into behavior, and predict future trends. In
customer analytics, AI applications typically include machine learning (ML), natural language
processing (NLP), predictive analytics, and real-time data processing. These tools empower
businesses to:

Understand Customer Behavior:

By analyzing patterns in transaction data, payment trends, and service usage.

Segment Customers:
Based on demographics, usage behavior, or risk profiles.

Provide Personalized Recommendations:

Tailored offers and services that meet individual needs.

Detect Fraud and Reduce Risks:

AI algorithms identify suspicious activities and mitigate risks.

E nhance Customer Support:

AI-driven chatbots and voice assistants provide real-time support.

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 Enhanced Digital
Payments Ecosystem
The FinTech industry remains dynamic, with startups developing
specialized solutions for financial inclusion, payments, lending, and
remittances. Key areas include increased adoption of QR-code
payments, tap-to-pay systems, and blockchain-based remittance
solutions. FinTechs like Flutterwave, Chipper Cash, and Paystack lead
innovation, bridging retail commerce with digital finance. Embedded
finance solutions integrate financial services directly into e-
commerce, ride-hailing, and agritech platforms, creating seamless
user experiences. FinTech companies are increasingly partnering with
telecom providers to scale embedded credit and insurance solutions.
Furthermore, digital lending solutions offer small-scale loans to micro-
enterprises and individual consumers without the need for traditional
credit scores.

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Conclusion
In 2024, this synergy has fundamentally redefined traditional banking As Africa's digital
models, enabling innovative financial products, broader inclusion, and financial ecosystem
enhanced accessibility for underserved populations. matures, its ability to
adapt and innovate will
Telecom operators, leveraging their expansive networks and customer bases, have emerged shape the future of
as formidable players, bridging gaps in financial service delivery where traditional institutions financial inclusion and
have struggled. Fintech, with its agile and customer-centric approach, complements these economic growth.
efforts by driving digital innovations that prioritize convenience, speed, and cost-efficiency.

However, the intersection of telecom, retail banking, and fintech also presents distinct
challenges. Regulatory complexities, data privacy concerns, interoperability issues, and the
digital divide remain critical barriers. Stakeholders must prioritize collaboration, transparent
policies, and infrastructure development to sustain the sector's progress and unlock its full
potential.

As Africa's digital financial ecosystem matures, its ability to adapt and innovate will shape the
future of financial inclusion and economic growth. This report underscores the importance of
strategic partnerships, scalable solutions, and forward-thinking governance in navigating
these realities and capturing the abundant opportunities within Africa's dynamic financial
landscape.

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06
About Agpaytech
Agpaytech Ltd. is a company pioneering in the Fintech space with a focused approach to building robust technologies

for e-commerce Card Processing Solutions for Payment Service Providers (PSPs). Additionally, we provide

Compliance and Regulatory Umbrella, Remittance-as-a-Service (RaaS), Banking-as-a-Service (BaaS), Foreign

Exchange, Cross Border Payments, and digital currency technology.

We also provide practical white paper research support to central banks, government and private institutions,

economic organizations, and NGOs in Africa. Our services expand from research projects, state-of-industry reports,

project assessment, data collection, and consulting services in the fintech space.

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