The report, titled “Beyond Borders: Digital Payments and Commerce,” reveals that Africa is experiencing the fastest digital commerce growth globally, at a staggering 25% annually. This dwarfs the growth rate observed in developed countries, which sits at a steady 13%. By 2026, the top five African markets – Egypt, Kenya, Morocco, Nigeria, and South Africa – are expected to reach a combined digital commerce value of $72 billion, according to EBANX.
Untapped Potential: Millions of New Consumers on the Horizon
Mobile Money Reigns Supreme: Alternative Payments Drive Financial Inclusion
The report sheds light on the unique payment landscape in Africa. Unlike developed regions where credit cards dominate, African consumers heavily rely on alternative payment methods (APMs) due to limited access to traditional financial services. Mobile money emerges as the clear winner, accounting for a whopping 69% of digital commerce transactions. Cash on delivery remains popular at 30%, but experts predict APMs will hold an even greater share in the coming years.
How SMEs Can Thrive in Africa’s Digital Goldmine
EBANX offers valuable insights for SMEs to navigate and leverage Africa’s burgeoning digital marketplace. Here are key takeaways for business success:
- Embrace Mobile Commerce: Develop a user-friendly mobile platform or partner with existing marketplaces to reach the mobile-savvy African consumer.
- Offer Multiple Payment Options: Integrate APMs like mobile money wallets to cater to the unbanked population and ensure a smooth checkout experience.
- Build Trust: Since online shopping is a relatively new concept for many Africans, prioritize building trust through customer reviews, secure payment gateways, and transparent return policies.
- Go Local: Tailor your marketing and products to local preferences and languages. Consider partnering with local influencers to expand your reach.
- Leverage B2B Marketplaces: Join B2B online platforms to connect with other businesses, streamline logistics, and eliminate intermediaries.
By implementing these strategies and staying abreast of the latest trends, SMEs can unlock the immense potential of Africa’s digital commerce boom. This exciting market presents a unique opportunity for businesses to grow and contribute to Africa’s flourishing digital economy.