Financial Technology in Zambia
Economy, Personal Finance, Strategy

The Financial Technology (Fintech) revolution across the globe continues to disrupt status quo as it brings solutions that are helping organizations improve their service and operations while enjoying the benefits of cost savings and operational efficiencies. This revolution is committed to delivering the next level banking experience to the client, one that will bring forth a paradigm shift.

Recently, there has been increased collaboration between Fintech companies (Fintech’s) and banks seeking to enhance their product offering. It’s safe to say Fintech’s and banks complement each other in that the former rely on banks to provide back-end transaction details, risk management and regulatory compliance support for their solutions to work. Furthermore, there has been a notable trend in financial instituitions making investments in modern technology to support their businesses while partnering with Fintech’s and Mobile Network Operators (MNOs).

It’s no secret that mobile, card and automated clearing house (ACH) transactions are growing while cash use is decreasing.  The Bank of Zambia (BoZ) reports that mobile transactions on digital platforms have drastically grown from 17,000 worth of volumes in December 2012 to 300,000 in December 2018 and these volumes are yet to increase. Such statistics show an upward trend in digital adoption which means that there is potential for financial institutions in Zambia to support technological advancements that will facilitate business operations on digital platforms. This presents a unique opportunity for Fintech’s to bring innovative solutions that better meet the customers’ needs and drive regular usage of digital platforms – It would also be useful to understand that because Fintech’s are not regulated by the same laws as banks, they tend to be more flexible with digital capabilities that sustain convenience.

But what does the Fintech landscape in Zambia look like? what are the existing Fintech’s currently offering? what challenges are they facing and what support do they require? Let us look at a snapshot below of promising local Fintech players to enable us outline the landscape of the Fintech industry in the country.

As at 2018, the United Nations Capital Development Fund (UNCDF) reported at least 25 Fintech’s providing solutions for sectors which included health, agriculture and financial services. Of the 25 above, the most common used Fintech’s are Kwikfin and Jumo for digital financial solutions offering credit lending, Zoona, Kazang and Zazu for cash payments/transfers providing solutions to retailers, Necor and Probase for ICT solutions to financial instituitions and Bongohive, Zambia’s first and only technology innovation hub. However, these Fintech’s depend on collaborations with stakeholders to function and remain relevant. Some of the key stakeholders in Zambia include Zambia’s three MNOs – Airtel, MTN and Zamtel, all banks and of course the regulators – BoZ, ZICTA, ZECHL, CCPC and PACRA.

From the landscape above, you may be wondering why some Fintech’s are more successful than others. Could it be that others have not been exploited enough? Are they costly to use? Or is there no support to drive innovation for start-ups? Let us identify a few challenges holding back the growth of tech-driven start-ups in Zambia.

  • Entry barriers – High lending rates make it difficult for start-ups to access funding for their innovative ideas and even when they do get funding, access to the right contacts (decision makers) in these instituitions to discuss collaboration possibilities can also make it difficult for fintech’s to start hence foreign players/brands with already existing partnerships are given priority to take up these opportunities.
  • Regulation – Regulators consistently struggle to keep pace with the speed of innovation. Given the intense scrutiny financial institutions face, they may be wary of investing in fintech solutions as that has the potential to derail partnership conversations. However, the launch of the ZICTA ICT innovation programme has since provided a regulatory platform for entrepreneurs with innovative ideas to thrive but there is a need for policies and incentives to be formulated that will guide the workings of the local Fintech space.
  • Compatibility with existing IT systems – Banks are now more than ever focusing on establishing stable IT infrastructures which require updates to core systems that allow them to operate efficiently. A lot of time and resources are invested in doing this hence the aspect of incorporating new innovations is therefore closely scrutinized. Some banks are not willing to support integration of their application programming interfaces (APIs) (systems which enable developers to create software apps) with Fintech’s due to concerns around data & cyber security. In addition, some new technologies being created by Fintech’s are incompatible or require significant changes to existing IT infrastructures hence become hard to sell despite their potential benefits.
  • Innovation hubs – There isn’t a huge presence of technology incubators in Zambia such as Bongohive to promote skill, capacity and capability development in the Fintech space. There is a need for active innovators and believers who will see Fintech’s potential to transform banking the way Uber has impacted transportation, Airbnb has disrupted travel accommodations and Amazon has revolutionized commerce.

Are Fintech’s the key to achieving Zambia’s Financial Inclusion targets by 2022? I believe so! There is no shortage of opportunities for Fintech’s to contribute to the financial inclusion sector by bringing financial services within the reach of all Zambians. As a matter of fact, in November 2017, the Ministry of Finance unveiled the country’s first National Financial Inclusion Strategy which targets an overall increase in financial inclusion from 59% to 80% in the formal sector and 38% to 70% for the informal sector by 2022 with key drivers being (1) accessible digital platforms through mobile phones, branches & ATMs and (2) creation of innovative client focused products to promote savings and credit facilities for start-ups and SMEs.


Although the Fintech sector in Zambia is still dawning, opportunities are there! This sector promises to help address challenges of low financial access and improve financial inclusion by creating new tech-enabled solutions that improve the availability and accessibility of financial services to all Zambians. Fintech’s now more than ever need to find means of demonstrating more mutually beneficial business proposals for their proposed solutions to encourage collaborations and investments with the existing financial institutions.

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