African fintech’s most valuable companies didn’t overcome their constraints. They turned them into moats, Michael Jordaan, founder of Montegray Capital, partner at Chronos Capital and former FNB CEO, told the RMB Think Summit on Tuesday.
“An African fintech that wins is a fintech that is designed for the constraint instead of waiting for the constraint to disappear,” he said, distinguishing African fintech development from many other successful fintech innovations around the world.
Jordaan’s thesis, drawn from his own investment portfolio, is compact enough to fit on a Post-It note: in African fintech, the constraint is the moat. The thing that looks like the problem – the cheap phone, the absent credit record, the patchy data coverage, the labyrinthine regulatory paperwork – is not merely the market condition you need to survive, he said, it is the strategic asset that protects you once you have. The harder the constraint is to design around, the less likely your rivals will bother.
Most African fintechs have died in a specific, predictable way: beautiful app, wrong customer, he said. Someone builds a sleek product for a smartphone the user doesn’t own, backed by a credit card the user doesn’t have, to solve a problem the user didn’t actually experience.
An underserved market
The irony is that the market itself is enormous and genuinely underserved. In 2025, more than $1.4-trillion moved through mobile-money wallets in Sub-Saharan Africa, about two-thirds of global mobile-money transaction value, across a continent that now dominates both transaction value and volume.
Last year, more than $1.4-trillion flowed through 127 mobile-money services and digital wallets across Africa, a 27% increase on the year before, representing roughly two-thirds of the entire planet’s mobile monetary value and three-quarters of global mobile-money transaction volume. All on one continent. About 40% of Sub-Saharan adults hold a financial account, and for one in five of them, it’s the only one they have.
So, while development economists and regulators fret about retail bank rollout in underserved regions, the money has already gone digital. It just didn’t go to a bank branch, and it didn’t go through a Visa card. The payment rails exist. They are simply not the rails that were assumed.
Africa’s banking branch network, Jordaan argued, wasn’t built by banks. It was built by shopkeepers: the spaza shops, the tuck shops, the kiosks, the woman selling vouchers from a cooler box. “Distribution is destiny,” he said. “If you’re in the shop, you win. If you try to replace it, you lose.”
There is also the demographic context that tends to get acknowledged in passing and then ignored. Africa’s median age in most countries is under 20. The continent’s population is the youngest, fastest-growing consumer market on earth – and one with no legacy banking habits to unlearn. No chequebook nostalgia. No branch-relationship conditioning. Whatever financial behaviour you can make work on a phone becomes the default.
Strategic choices
Jordaan organised his talk around four strategic choices that distinguish the companies that work from the ones that demo well and quietly expire.
1. Build for the device people actually own
Not the latest smartphone. Not the aspirational device. The one already in the customer’s hand, even if that is a basic-feature phone. The canonical example here is M-Pesa, which has been quietly correct about this for 19 years by betting on USSD, despite its clunky star-hash menu, that runs on every phone ever made with no app, no data and no smartphone required. It is unpleasant to use. It is also the only channel that reaches the entire continent simultaneously.
2. Don’t try to be the bank – sit behind it
This is, Jordaan argued, the architectural principle underlying almost every African fintech that actually works. The customer faces a licensed entity they already trust – a bank, a mobile operator, a wallet. The fintech sits behind it, carrying the technology and often the risk, invisible to the end user. Unglamorous. No logo on the billboard. But also no banking licence required, no branch network, no need for anyone’s permission to exist.
Optasia is his purest example. It distributes more than $30m per day across more than 32-million loan transactions – at an average loan size of roughly US40c. “No conventional lender on earth can underwrite those economics” he says. “Optasia does it by functioning as a credit-scoring brain layered on top of mobile network operator data.” How regularly someone tops up airtime. Whether data usage is consistent or erratic. Whether they receive calls from a broad, stable network.
These signals reveal financial reliability in ways traditional credit bureaus cannot access, because traditional credit bureaus have no data on these customers at all.
3. Treat the constraint as the moat, not the problem
Here Jordaan reached his thesis explicitly, illustrated through two structural examples.
Until 2025, a card payment between two people standing on the same street in Lagos was very likely processed through infrastructure in the US or Europe. Fees were paid in dollars. Transaction data sat in foreign jurisdictions. African payments were leaving Africa just to come back. This was universally described as an infrastructure problem. The interesting companies saw it as unclaimed territory.
Mercury, the African Export-Import Bank, and the Pan-African Payment and Settlement System, PAPSS, launched the first card scheme that clears African transactions inside Africa, called PAPSS Card. Building a card scheme required years of certification, regulatory sign-off, central bank participation, bank-by-bank integration, and the kind of exhaustive documentation that would defeat most people.
