Picture this: Africa’s fintech ecosystem is like a gleaming new highway. Cars (read: payments) zip along, startups pop up like roadside kiosks, and investors keep buying toll passes. But take a closer look and you’ll notice the cracks - potholes, missing bridges, and a few detours through unmarked paths.
That’s the state of payments infrastructure in Africa. We’ve made huge strides - mobile money, digital wallets, and an explosion of fintechs. Yet, if Africa wants to compete globally, we need to close some serious infrastructure gaps.
Let’s unpack the big ones: payment switches, fragmented mobile money, regulatory hurdles, and instant payment schemes. Buckle up.
1. Payment Switches: The Broken Roundabouts
A payment switch is like a universal traffic roundabout connecting banks, PSPs, and fintechs so payments flow smoothly. Globally, switches like India’s UPI or Europe’s SEPA act as single highways where everyone plugs in and rides at speed.
In Africa? It’s more like twenty different roundabouts, each with its own traffic lights, tolls, and rules. Nigeria has NIBSS, Kenya has PesaLink, Ghana has GhIPSS, and South Africa has BankservAfrica. Each works locally, but crossing borders? That’s a headache.
Why It’s a Gap
Fragmentation – Every country reinvents the wheel.
High costs – PSPs pay multiple integration fees.
Poor cross-border flow – Sending money from Tunisia to Nairobi feels like shipping by donkey cart.
Global Comparison
India’s UPI – One integration, instant payments nationwide, open to fintechs.
SEPA in Europe – A single euro payments zone, harmonized rules, smooth cross-border flows.
Until Africa harmonizes or links its switches, we’re stuck with siloed corridors.
2. Fragmented Mobile Money: The Walled Gardens
Mobile money is Africa’s crown jewel. In Kenya, M-Pesa is practically a currency. In Ghana, MTN MoMo dominates. Across the continent, mobile wallets outnumber bank accounts by miles.
But here’s the catch: telcos run their own walled gardens. Sometimes, sending money across networks is clunky and you’ll be hit with fees and delays.
Why It’s a Gap
No interoperability – Each telco wants to be the king of its castle.
High transaction friction – Customers pay extra for cross-network transfers.
Limited global reach – Mobile money struggles to plug into global rails like Visa, Mastercard, or SWIFT.
Global Comparison
India’s mobile wallet unification – Most wallets now connect through UPI.
China’s Alipay and WeChat Pay – Different providers, but interoperable at scale.
Africa needs interoperability frameworks that make mobile money truly borderless. Otherwise, the dream of a single African payments market stays a dream.
3. Regulatory Hurdles: The Patchwork Quilt
Here’s where things get bureaucratic. In Africa, regulation is a patchwork quilt stitched together by different central banks, each with its own fabric and style.
Want to launch in Nigeria? Get a CBN license. In South Africa? The SARB has its own rules. Kenya’s CBK will want their pound of flesh too. Imagine if you want to operate across multiple countries.
Why It’s a Gap
Inconsistent rules – What’s legal in one country might be illegal in the next.
Slow approvals – Licenses take months, sometimes years.
Compliance burden – Fintechs spend more on lawyers than on product innovation.
Global Comparison
EU’s PSD2 framework – Harmonized rules across 27 countries. One license = whole EU market.
Singapore’s MAS sandbox – Streamlined approval process encourages innovation while protecting consumers.
Africa has made progress with the Pan-African Payment and Settlement System – PAPSS, but without regulatory harmonization, scaling remains painfully slow.
4. Instant Payment Schemes: The Need for Speed
The world is moving to real-time payments. Customers expect money to move as fast as their WhatsApp messages.
In Africa, instant payment schemes (IPS) like Nigeria's NIBSS, Kenya's PesaLink work well domestically but are patchy when it comes to cross-border payments.
Why It’s a Gap
Limited coverage – IPS schemes are national, not regional.
Lack of interoperability – Schemes don’t talk to each other.
Slow adoption – Many banks still prefer batch processing.
Global Comparison
India’s UPI – Near-instant transfers, 24/7, integrated across banks and fintechs.
UK’s Faster Payments – Same-day and real-time transfers since 2008.
For Africa to compete globally, IPS needs to go continental, not just national.
The Bigger Picture: Competing Globally
Closing these gaps is about global competitiveness.
Standards matter – The world is moving to ISO 20022 for data-rich payments. Africa risks being left behind.
Cross-border trade – Under the AfCFTA, Africa needs interoperable systems to power intra-African trade.
Investor confidence – Global players want to plug into ecosystems that “just work,” not navigate a spaghetti bowl of rules and rails.
If Africa patches these potholes, fintechs will dominate locally and globally.
Niobi’s Take
At Niobi, we see this every day. Businesses want fast, compliant, and borderless payments. But the gaps slow them down.
Our job is to help you ride over the potholes without wrecking your suspension. Whether you’re an SME or a scaling fintech, Niobi gives you rails that actually work across Africa.
Wrap-Up: The Road Ahead
Africa’s fintech highway is buzzing with traffic, but the cracks are showing. To compete globally in 2025 and beyond, fintechs and PSPs must push for:
Interoperable switches
Unified mobile money ecosystems
Harmonized regulations
Continental instant payment schemes
Do that, and Africa will set the pace. Until then, we’ll keep patching potholes. The global payments race is on, and nobody wants to be left eating dust.
