Globalisation and technology advancements have created unprecedented growth opportunities between the UK and African markets. As part of the UK Innovation Strategy, the UK has invested over £4 billion in African tech startups and digital infrastructure through private sector deals and government-backed initiatives. Yet, despite this potential, cross-border payments remain a significant challenge, with currency volatility, high transaction fees, and regulatory complexities obstructing seamless trade.
To help UK businesses overcome these obstacles, Ola Oyetayo, CEO and co-founder of Verto, shares insights on how fintech innovations can streamline cross-border payment processes.
Africa’s expanding market potential
Africa’s tech scene is thriving, with countries like Kenya earning the “Silicon Savannah” moniker due to its dynamic startup landscape. In agriculture, there’s a push towards modernisation and increased productivity, opening doors for UK agritech firms and investors.
The numbers reinforce this outlook: According to a new UN Report, Africa’s economic growth is expected to rise from 3.4 per cent in 2024 to 4.0 per cent by 2026, outpacing many developed economies. The National Bureau of Statistics reported that Nigeria, Africa’s largest economy, grew its GDP by 2.98% in the first quarter of 2024. In Kenya, total consumer spending is tipped to reach $89.73 billion in 2025, up from $49 billion in 2015, according to Statista.
However, capitalising on these opportunities requires more than just market entry–it demands efficient financial infrastructure. Seamless cross-border payment systems are crucial for businesses to:
- Pay suppliers promptly and reliably
- Receive payments from African customers without delays or excessive fees
- Manage currency risks effectively
- Comply with complex regulatory frameworks across multiple African nations
Cross-border payment barriers
Cross-border payments between the UK and Africa are complex and can pose significant risks to expanding business. One of the primary challenges is currency volatility, driven by economic and political instability in regions like Nigeria, Ghana, Sierra Leone, Ethiopia, Central Africa among others. These fluctuations can lead to unexpected financial losses that complicate planning for UK businesses.
An additional hurdle is underdeveloped banking infrastructure in certain markets, leading to delays and inefficiencies in transaction processing. High international transfer fees further compound these issues, making them particularly burdensome for SMEs operating on tight budgets.
Regulatory compliance presents another challenge. With rules varying widely across African jurisdictions, UK businesses must navigate a complex web of Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements. This increases the non-compliance risk and adds to the time and resources needed to establish operations in new markets.
These barriers can significantly slow market expansion, increase financial risk, and divert resources away from core business priorities.
The role of fintech in simplifying payments
Fintech solutions are emerging as game-changers in streamlining cross-border payments. These innovative platforms offer multi-currency wallets, allowing companies to hold and transact in various African currencies, reducing exposure to exchange rate fluctuations.
The integration of APIs and automation in fintech platforms significantly reduce human error, streamlining payment processes and increasing operational efficiency. These platforms have built-in compliance features that seamlessly integrate with regulatory frameworks to ensure adherence to AML and KYC requirements across different African markets.
One of the most compelling advantages of standout fintech solutions is their commitment to transparent pricing structures. Unlike traditional banks, which often apply hidden fees and unfavourable exchange rates, fintech platforms provide upfront costs. This clarity enables businesses to forecast transaction expenses and make informed financial decisions with confidence.
However, not all solutions are created equal. Businesses should carefully evaluate fintech providers, ensuring they offer transparent pricing, regulatory compliance, and seamless integration to support their specific cross-border payment needs.
The passport to market success
With the right financial tools and partnerships, UK businesses can overcome key payment barriers and unlock opportunities in Africa’s high-growth markets.
Selecting the right fintech partners is crucial for developing robust, scalable strategies tailored to Africa’s financial landscape. As UK-Africa trade expands, fintech is making cross-border transactions more seamless and accessible than ever.
