Foreign investment and intercontinental expansion are notable ways by which Nigerian fintechs can scale their operations. These two pathways have been pivotal in making the fintech sector the most attractive sector for investment in the Nigerian tech ecosystem. Between 2014 and 2019, more than $600 million was raised by Nigeria’s thriving fintech industry, accounting for 25% ($122 million) of the $491.6 million raised by African digital startups in 2019 alone.

Among the largest beneficiaries of this capital were OPay, which raised $400 million in  Series C funding, Flutterwave, which got $170 million in a Series C round, and Chipper Cash, which raised $250 million, to mention a few.

In recent times, however, we’ve witnessed a downturn in startup funding;  H1 2022 saw a 20% decline in venture capital funding compared to H1 2021, according to a recent report by TechCabal Insights. Partnerships, mergers, and acquisitions (M&A) are the other opportunities available for investors and startups to scale in the ecosystem.

There is also a problem of uneven distribution of investment deals as fundraising isn’t always a smooth sail even for fintechs. Despite the increase in funding for fintechs in Nigeria over the last seven years, the fluctuating exchange rates and unclear regulatory and legal frameworks are setbacks that often discourage investors from backing startups in the sector.

Nevertheless, the fintech sector continues to grow and investor interest remains high. It has become even more important for fintechs to pay more attention to building valuable products and creating an environment that attracts investments and positions the business for partnerships and acquisitions.

At the Fidelity International Trade & Creative Connect, one of the fintech panel sessions was focused on how African fintechs can harness the potential of intercontinental expansion to scale the ecosystem. The session featured fintech experts including Adedoyin Odunfa, MD/CEO, Digital Jewels Africa; Ben Champion, CEO, Nanumo; Sukhi Srivatsan, Head of Sales and Business Development, AZA Finance; Edidiong Uwemakpan, Group Head, Marketing and Communications, TeamApt; and Ovie Esiekpe, VP of Growth, VertoFX. 

L-R:  Adedoyin Odunfa, MD/CEO Digital Jewels Africa; Ben Champion, CEO, Nanumo; Sukhi Srivatsan, Head of Sales and Business Development, AZA Finance; Koromone Koroye, Managing Editor, TechCabal; and Edidiong Uwemakpan, Group Head, Marketing and Communications, TeamApt

One major takeaway from the conversation was that fintechs must not underestimate the power of partnerships and expansions to enable them to increase their footprint and diversify their risk. In the words of Nanumo’s CEO, “the greatest opportunity lies within collaboration”. 

On the 15th and 16th of November, Fidelity Bank, in partnership with TechCabal, hosted the inaugural edition of the Fidelity International Trade and Creative Connect. The event brought together leading entrepreneurs, investors, and regulators operating in the commodity, service, creative, fashion, and fintech sectors in Nigeria, to discuss the strides of players in the tech and creative sectors. The conference featured fintech industry experts that discussed the partnership opportunities that can be leveraged to scale the fintech ecosystem.

Get the best African tech newsletters in your inbox