Kenya's FinTech Ambition: Boosting Financial Inclusion ¶
Kenya has the opportunity to become a continental leader in FinTech and dramatically boost financial inclusion by enhancing the existing ecosystem, according to a new research from TheCityUK and the Nairobi International Financial Centre (NIFC) developed by PwC.
The report highlights Kenya's forward-thinking financial inclusion strategies and incentivising schemes, such as the phased enactment of a dedicated payments and digital lending regulatory framework and the adoption of regulatory sandboxes.
Formal financial inclusion in services and products in Kenya has grown significantly from 26.7% in 2006 to 83.7% in 2021, largely driven by new financial technology and innovations, especially in mobile money and mobile banking.
Kenya's FinTech ecosystem has been driven by digital financial products, which have played a significant role in catalysing financial development and inclusion across the country, especially due to the affordable and accessible services layered onto mobile and digital platforms infrastructure.
However, gaps and challenges still exist that impact the evaluation, approval, and regulation of new and complex FinTech products and innovations. The report makes the case for a series of policy and regulatory enhancements to spur greater innovation, unlock capital and investment, and further accelerate financial inclusion.
Joseph Githaiga, Associate Director, PwC Kenya, said, 'FinTech is changing the nature of financial services globally. It has made itself a key driver of economic development by speeding up financial inclusion and introducing innovative financial products at a rapid rate.'
Glynn Austen-Brown, Partner, PwC UK, added, 'The progress made in digital innovation worldwide calls for countries to recognise the evolution of financial services offerings. Kenya's efforts in the growth of FinTech can be seen through its forward-thinking financial inclusion strategies and incentivising schemes.'
Scott Devine, Head Middle East and Africa, TheCityUK, said, 'There is a rapidly developing global market for FinTech, data, and technology, and this presents real opportunities for those countries in a position to capitalise.'
The report makes a series of recommendations for policymakers to consider, including establishing a FinTech provider-facing one-stop shop, creating a consolidated FinTech sandbox, and encouraging more collaboration amongst FinTech providers, regulators, and stakeholders.
