An influx of new technology-driven financial services businesses will materially improve access to finance for African entrepreneurs. With an annual trade finance gap of $80bn-$120bn, Africa has a well of untapped potential in the small & medium enterprise sector, and closing the gap will be transformational for the continent.
This traditional model of banking is not fit for purpose in 2022, and these old-school documents will not show in real time how many transactions are going through your business or the hard slog you have put in to secure a contract supplying a major blue-chip client as an enterprise development beneficiary.
As a bank we are seeking out strategic relationships with multinationals as well as development finance institutions to try to close this gap here, and agriculture is one of the areas where we believe we have made progress in the last few years. We are now expanding our focus to more specialist businesses, including those operating in the manufacturing and technology sectors. The African Continental Free Trade Area will drive regional trade and this is where data will be particularly important.
Kenya and Nigeria look particularly exciting, with a variety of new technologies and players coming to the fore. Ghana is another country we are excited about. The banking system and payments infrastructure have evolved significantly in the past 10 years, and it now also has fintech businesses like Float, which helps provide short-term liquidity and cash flow. Float raised $17m from international investors, while payment platform Dash raised $32.8m in March 2022.