The Time is Ripe for Africa Fintech listings says Absa. As start-ups on the continent struggle to seek venture funding amid a global slowdown, banking giant Absa stated that the moment is right for African fintech firms to consider public listings at home.
The Time is Ripe for Africa Fintech Listings Says Absa
According to Adesoji Solanke of Absa Group, an initial public offering on a local exchange can make sense as a way out for investors in fintechs that make the majority of their revenue in a single local currency.
Head of fintech investment banking origination at Absa Securities UK, Solanke, stated in an interview on the fringes of a conference in Nairobi, “We shouldn’t assume that the depth of liquidity on local stock exchanges is zero.” “We now have sizable pension funds that are invested in certain African nations.”
Africa is experiencing the fastest population growth in the world, as a growing number of its youthful, tech-savvy citizens look for ways around the region’s outdated, underdeveloped legacy financial institutions.
As a result, the fintech sector is growing, and startups including Flutterwave, Chipper Cash, and Interswitch have expressed interest in going public in the US or the UK.
Many African Fintech Companies have Already Gone Public on Local Exchanges
According to Solanke, there are benefits to listing domestically over global markets, such as less stringent listing standards and local investors having a better understanding of the companies.
Many African fintech companies, such as High Payment Systems in Morocco, e-Tranzact International in Nigeria, Lesaka Technologies in South Africa, E-Finance for Digital & Financial Investments, and Fawry for Banking & Payment Technology Services in Egypt, have already gone public on local exchanges.
International listings are a feasible option for African fintech companies with robust growth and regionally diverse revenues, according to Solanke.
Significant African Cellular Operators Like MTN Group, Vodacom Group, and Airtel Africa, Have Established Sizable Fintech Divisions
Significant African cellular operators, such as MTN Group, Vodacom Group, and Airtel Africa, have established sizable fintech divisions that may go public in the future. Airtel’s mobile money division was valued at $2.7 billion in 2021, while MTN sold Mastercard a US$200 million share in its fintech last year, valued at R100 billion.
One of the markets for wireless network providers in sub-Saharan Africa that is expanding the fastest is mobile money, where customers keep and manage money in an account connected to a mobile phone.
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