Equity capital raised by African fintech companies during the first half of 2023 has witnessed a significant 40% decline compared to the previous year. Despite this downturn, loan funding experienced a remarkable surge, recording an increase of over 80%.
Data from the Afridigest Fintech Transactions Database underscores the prominent role of debt in this rise, primarily driven by two major transactions: MNT-Halan’s $140 million securitized bond offering and M-Kopa’s $200 million debt financing. Notably, excluding these deals would reveal a modest year-on-year growth in H1 debt funding.
From the first to the twenty-sixth week of the year, the database encompasses equity and debt funding, along with merger and acquisition transactions, adhering to global deal reporting standards while excluding grants.
In the report’s spotlight, 75 African fintech firms garnered $1.2 billion in risk capital across 85 transactions during H1 2023. This translates to an average of 14 deals and $200 million in funding each month.
The sectoral breakdown indicates that banking and lending segments led the charge, commanding $0.66 of every equity dollar and $0.96 of every debt dollar raised during this period. Noteworthy players in this realm include MNT-Halan, Lulalend, TymeBank, FairMoney, M-Kopa, and Planet42.
Afridigest also highlights a notable uptick in fintech mergers and acquisitions across Africa in H1 2023, with 15 acquisitions announced compared to 13 in the same period the previous year.