Even as the global economy grapples with inflation, supply chain constraints and high commodity prices, new payment solutions are helping billions in emerging markets access and deploy much-needed capital.
Driven by a decline in cash payments during the Covid-19 pandemic, digital payments skyrocketed in line with the growth in e-commerce, as the financial technology (fintech) sector expanded to provide consumers with a wider variety of payment options.
The growth of digital payments has been strongest in emerging markets, where noncash retail payments increased by a compound annual growth rate (CAGR) of 25% between 2018 and 2021, compared to 13% globally for the same period. A young, tech-savvy population and demand access to financial services are driving growth.
Digital payments are expected to continue to expand globally, with a projected CAGR of 15% for 2022-26.
Fintech in emerging markets has also drawn significant investment. Fintech operators accounted for 37% of the record $4.85bn in funding that African start-ups received in 2022 – the largest share of any…