Chika Nwosu, the managing director of PalmPay Nigeria, has emphasised the necessity of fintechs to increase investor trust in order to stimulate additional investment throughout the continent.

He pointed out that generating value required strong collaboration with investors.

Speaking at the just ended 2024 Nigeria Fintech Week in Lagos, which had as its topic “Positioning Africa’s Fintech Ecosystem to Accelerate Growth,” Nwosu made the request.

According to Nwosu, “The fintech ecosystem is not saturated, but founders must be mindful of building investor confidence amid rising interest rates and currency devaluation.” The Egyptian pound, naira, rand, cedi, Congolese franc, and Kenyan shilling are among the majority of sub-Saharan African currencies that have witnessed a sharp decline in value relative to the US dollar.

“Investment value is being impacted by this devaluation, which reduces investor confidence and makes it more difficult for fintech startups to obtain funding.”

According to Nwosu, who took part in a panel discussion titled “Safeguarding the Funding Pipeline for Fintech in Africa,” founders might lessen those difficulties by diversifying their sources of income and growing into other areas.

He said that businesses may be vulnerable to regional economic instability if they just rely on one market.

Fintechs may diversify their risk and lessen the effects of volatility in any one area by joining a variety of areas, he added.

Investments in the fintech industry in Africa have drastically decreased, falling 77% to $186 million from $826 million in H1 2023, according to Ade Bajomo, President of FintechNGR.

The average deal size dropped from $10.5 million in H1 2023 to $4 million in H1 2024, while the number of agreements plummeted by 30% year over year. But there are still a lot of development prospects on the continent,” he said.

Bajomo said that in order to keep educated, entrepreneurs must constantly interact with regulators and lawmakers.