Senegal: The Rising Fintech Hub in Francophone West Africa
A Growing Digital Sector
Senegal is making significant strides as a major fintech hub, aiming to create 35,000 new jobs in technology by 2025. The country boasts impressive mobile phone usage statistics, with over 60% of the population using mobile phones and more than 70% of adults utilizing mobile money within the last 30 days.
Fintech Ecosystem on the Rise
The Senegalese fintech ecosystem is home to around 70 startups, with a significant majority (42%) focused on payments. The country’s first African Francophone fintech, Wave Digital Finance, achieved unicorn status in 2021 after raising $200 million from Silicon Valley venture capital firms.
Key Statistics:
- 70% of adults use mobile money within the last 30 days
- 60% mobile phone usage in Senegal
- 42% fintech startups focused on payments
- 35,000 new jobs to be created in technology by 2025
Challenges and Opportunities
Despite progress made, Senegal still faces challenges related to fintech regulation and definitions. There is a lack of specific regulatory framework for fintech businesses, with some calling for the establishment of a regulatory sandbox and clearer guidelines on fintech subsectors.
Regulatory Challenges:
- Lack of specific regulatory framework for fintech businesses
- Need for regulatory sandbox to support innovation
- Clearer guidelines on fintech subsectors required
Central Bank Takes Action
In response to these challenges, the Central Bank of West African States (BCEAO) has created its fintech bureau, BCSF. The department aims to promote and support the development of startups offering financial services in West Africa, while also handling tasks related to technological innovation and financial sector regulation.
Fintech Bureau:
- Promotes and supports development of fintech startups
- Handles regulatory tasks related to technological innovation
- Supports financial sector regulation
Crypto and Digital Payments on the Rise
Senegal is not immune to the global trend of cryptocurrencies, with Akon outlining plans to set up a crypto-style city. The country has also seen the emergence of Bitcoin Senegal, founded by Nourou last year. As mobile money continues to grow in popularity, it remains to be seen how these developments will shape the future of fintech in Senegal.
Crypto Developments:
- Akon plans to set up a crypto-style city
- Emergence of Bitcoin Senegal, founded by Nourou last year
Senegal’s Ambitions for a Francophone Fintech Hub
With a cohesive society under the rule of law as its guiding vision, Senegal is committed to becoming a major Francophone hub in the African continent. The country’s ambitions are reflected in its strategic guidelines for translating this vision into tangible actions and results.
As Richie Santosdiaz notes, “Senegal presents an opportunity for not just Francophone Africa but the African continent as a whole to showcase its innovation and talents.” With its fintech ecosystem on the rise, Senegal is well-positioned to take advantage of the growing demand for digital financial services in West Africa.