July 4, 2026 | African Meridian
Africa’s fintech story is entering a new chapter. Having built their foundations on payments and money transfers, the continent’s leading platforms are now launching a ‘second wave’ of services — retail investment products and AI-driven credit risk models — that push financial inclusion well beyond simply moving money from one phone to another.
The first wave transformed how millions of Africans transact. Mobile money turned basic phones into financial tools, giving people who had never held a bank account the ability to send, receive and store money. That achievement created something invaluable: a large base of digitally connected users and a rich trail of transaction data. The second wave is about building more sophisticated financial services on top of that foundation.
Retail investment products mark one leg of the expansion. By enabling ordinary users to invest — often in small denominations directly through their mobile wallets — platforms are opening access to savings and wealth-building tools historically reserved for the affluent or the formally banked. For consumers with modest incomes, the ability to put small sums to work, rather than merely hold cash, represents a meaningful step up the financial ladder.
The other leg is arguably more transformative: AI-driven credit risk models that use alternative data to assess creditworthiness. Traditional lending relies on formal credit histories, collateral and payslips — precisely what underbanked consumers lack, which has long locked them out of credit. The new models sidestep that barrier by drawing on alternative signals such as utility payments and phone usage patterns to build a picture of a borrower’s reliability.
By analysing behavioural and transactional data — how consistently someone pays their bills, how they use their phone and manage their mobile money — these models can score consumers who would be invisible to a conventional credit bureau. Done well, that allows lenders to extend credit safely to people previously deemed unbankable, unlocking access to loans that can smooth incomes, fund small businesses and cushion emergencies.
The approach carries genuine promise and genuine risk. Responsibly deployed, alternative-data credit scoring can dramatically widen access to finance and channel capital toward productive uses among populations long excluded. Poorly governed, it raises concerns about data privacy, algorithmic bias and the danger of over-indebting vulnerable borrowers through frictionless lending. The quality of the models — and the regulation around them — will determine which outcome prevails.
Taken together, the second wave reflects a maturing ecosystem moving up the value chain from basic transactions toward comprehensive financial services. If the continent’s fintechs can deliver investment and credit products that are both inclusive and sound, they stand to deepen financial inclusion in ways the first wave only began — turning a payments revolution into a broader transformation of how Africans save, borrow and build wealth.