Commonwealth countries should share experiences to drive Fintech innovation

Commonwealth fintech pioneers can help drive further innovation across all 56 member states through partnerships and shared learning, according to a new report.

The Commonwealth Countries: Driving FinTech Innovation the report outlines how member countries, such as Kenya, Jamaica, Nigeria, the Bahamas and the countries of the Eastern Caribbean Currency Union, are at the forefront of the evolutionary advances in fintech.

It also reviews the key fintech innovations, services and activities used across the association. These include mobile money and other digital payments, central bank digital currencies (CBDC), enterprise technology, cryptocurrency and alternative credit.

Regional differences

Many of these innovations are country and region specific. For example, in the Pacific region, Fiji, Samoa, Tonga and the Solomon Islands have high levels of mobile money registrations. While South Africa is leading the way in digital banking, with its first digital bank launched in 2019.

Seven Commonwealth countries are currently looking at the viability of CBDC technology, with most at the research stage and one (Nigeria’s eNaira) already launched. While several Commonwealth fintech companies have also used AI to improve financial literacy across the region. This includes Tanzania’s Plans launches an AI-based app that provides users with free financial advice.

According to the Commonwealth Secretariat, evidence from the report suggests that “opportunities are ripe for learning from Commonwealth fintech pioneers, to support fintech capacity building across the Commonwealth, as well as prospects for partnership and knowledge sharing with other Commonwealth countries.”

Next step

Commonwealth countries wishing to replicate the successes of other member states can
nurture fintech by leveraging existing demand and supply drivers, as well as improving factors to promote the provision of fintech services to fill identified gaps.

To help member states deal with challenges in fintech, the recommendations will focus on three areas:

• promote financial literacy
• improve digital infrastructure
• facilitate effective fintech regulation, which can provide guidance for fintech service providers going forward

The Commonwealth has outlined plans to focus on improving financial literacy across developing countries and small states. A meeting in Washington DC today brings together a panel of experts on financial literacy and financial inclusion.