There has been a seismic shift in African consumer preferences towards digital payment methods, according to a new survey by RegTech Africa and Agpaytech.

With 2 591 respondents from diverse regions, the findings underscore a resounding vote of confidence in electronic transactions – with an overwhelming 91% of participants expressing a clear preference for digital payment approaches over traditional cash methods.

The research – African Digital Payment Systems and Consumers’ Experience in 2023 – sheds light on pivotal insights driving Africa’s rapidly evolving payment ecosystem. A resounding 76% of respondents voiced concerns over the absence of a unified payment platform, advocating for accessible application platforms to consolidate their myriad of payment accounts seamlessly.

Mobile banking emerges as a cornerstone of Africa’s digital financial landscape, with 73,5% of respondents leveraging banking apps for various transactions. Remarkably, 85,5% utilise these apps for fund transfers and other payments – significantly reducing reliance on physical bank branches and with many users eschewing branch visits entirely.

While the survey reflects a burgeoning appetite for digital solutions, it also illuminates significant gaps in consumer awareness regarding Central Bank Digital Currencies (CBDCs). Despite their potential to transform financial infrastructure, 69% of participants admitted to lacking any knowledge of CBDCs highlighting the imperative for widespread education initiatives.

Interestingly, when presented with the concept of CBDCs, sentiments were divided with only 19,8% expressing agreement with their issuance while 47,9% opposed the idea and 32,3% remained uncertain. These findings underscore the necessity for comprehensive dialogue and education surrounding CBDCs to foster informed decision-making.

Moreover, the report uncovers persistent challenges hindering the widespread adoption of digital payment systems with 45,3% of consumers expressing dissatisfaction. High transaction charges, fraud concerns, and perceived security vulnerabilities were cited as primary deterrents signalling a pressing need for enhanced safeguards and regulatory frameworks.

Looking ahead, the research identifies a burgeoning interest in innovative payment trends including personalised services such as “buy now pay later”, “save now buy later”, WhatsApp banking, CBDCs, and open banking. As consumers gravitate towards tailored solutions, financial institutions are poised to capitalise on emerging opportunities to meet evolving demands effectively.

“As Africa embraces the digital revolution, it’s imperative for stakeholders to prioritise interoperability and user-centric design in crafting next-generation payment solutions,” says Cyril Okoroigwe, CEO of RegTech Africa. “By addressing consumer concerns and fostering collaboration across the financial ecosystem, we can unlock the full potential of digital payments to drive inclusive economic growth.”

Richard Amoah, CEO of Agpaytech, adds: “These findings mark a pivotal moment in Africa’s journey towards a digital-first economy. The overwhelming preference for digital payment solutions underscores the transformative potential of fintech innovation in driving financial inclusion and economic empowerment across the continent.”