To accelerate the expansion of digital public infrastructure translating into universal access to digital financial services for all Africans, the African Union Commission has entered a strategic partnership with AfricaNenda which aims to develop an advocacy program to support Digital Transformation Strategy for Africa (2020-2030), policy harmonization in Africa, and contribute to implementing the strategy’s roadmap with a particular focus on Inclusive Instant Payments Systems in Africa.
The partnership aims to unlock access to the formal financial system for over 400 million adults in Africa who are primarily financially excluded from the formal economy. This gap has exposed millions of people who are heavily reliant on cash or informal providers for their financial needs, which is costly, risky and leaves them vulnerable to economic instability. The partnership will also enhance collaboration with governments, central banks, regional organizations, the private sector, and development institutions.
The AU Commission and AfricaNenda convened a High Level Forum on Inclusive Instant Payments Systems in Africa aimed at “Advancing innovative solutions to accelerate expansion of Digital Public Infrastructure.”
The forum was equally timely as Africa makes progress in intra-African trade through the African Continental Free Trade Area where the digital financial services are increasingly boosting economic activities, transactions efficiency, reduced transactions costs, and enhanced the participation of women and youth in trade and investments.
Speaking at the session, the African Union Commissioner for Economic Development, Trade, Tourism, Industry and Minerals, H.E. Amb. Albert Muchanga highlighted the importance of the new partnership stating, “By leveraging the power of technology, we remove key obstacles that prevent financial inclusion. By offering access to digital financial services for all, we also help people and communities to fully participate in the economy, thereby benefitting from their talents and resilience. By coming here today, we are also affirming that to achieve our goal of providing digital financial services to every African, we must work together.
The stakeholder base is broad: Member States, the private sector, civil society organizations, academia, labour, youth, women, and, and among others, development cooperation partners. By collaborating and coordinating efforts, we can design and implement high impact policies, and broaden access to innovations.”
On his part the CEO of AfricaNenda, Dr. Robert Ochola restated the institution’s focus to strengthen relationships with national, regional, and continental stakeholders to support the development of inclusive instant payment systems in Africa. “Working with the Commission is a boost to our scale and reach. We are committed to continue striking strategic partnerships across the ecosystem to advance financial inclusion to drive sustainable and inclusive development in the continent. We are confident that our joint efforts with the African Union Commission will help accelerate access to digital financial services by all people in Africa”.
Both principals underscored the urgency to address the digital deficits and vulnerability by unlocking the potential of inclusive digital financial services on the continent. This is through the implementation of inclusive instant payment systems across Africa, and by removing barriers to the access to digital payments to mobilize the continent’s digital financial ecosystem for inclusive growth.
In a world increasingly reliant on digital connectivity, access to financial services remains a crucial determinant of economic empowerment and social development. Unfortunately, millions of Africans are excluded from the formal financial system, trapped in a cycle of poverty and limited opportunities, principally because of limited investments in digital infrastructure especially in our rural areas. Presently, the digital transformation is expanding to almost all economic sectors altering local job markets. Over 500 African companies provide technology-enabled innovation in financial services or fintech. With over 640 tech hubs active across the continent.