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The Impact of COVID-19 on Payment Infrastructure in Africa

COVID-19 became one of the biggest socio-economic disruptors since the 2007-2008 Global Financial Crisis. It posed unexpected challenges to global health and triggered a seismic shift in various economic factors, including the payment infrastructure in Africa.

The transformation it brought was seen in the rapid acceleration of digital payments, the expansion of mobile money and other digital payment services, the massive growth of the e-commerce sector, and a surge in fintech innovation and solutions across Africa.

This piece will discuss the overall impact of the COVID-19 pandemic on the African payment infrastructure, detailing the positives and the negatives.

Key Impacts of COVID-19 on Payment Infrastructure in Africa

Acceleration of Digital Payments

The COVID-19 pandemic accelerated the adoption of digital payment methods in Africa. During the pandemic, the lockdowns and social distancing made people turn to digital channels to carry out various functions and transactions, including purchases, meetings, and payments. This saw the massive adoption of mobile money and other digital payment services as people sought contactless ways to purchase everyday items, pay bills, receive government support, and send money to friends and family.

According to the GSMA, the number of mobile money subscribers in Sub-Saharan Africa increased massively to 184 million in 2021, a 12% increase from the previous year. This means that people lacking access to traditional banking services got involved in the financial system, increasing the volume and value of transactions.

The increased adoption of digital payment methods accelerated the rate of digital payments during and after the pandemic. In 2021, the volume of transactions in Sub-Saharan Africa increased to 36.7 billion, and the value of digital payments increased to 701.4 billion, indicating a 39% increase from 2020.

Expansion of Mobile Money

Mobile money was one of the digital payment services that saw a surge in adoption rate during and after the COVID-19 pandemic. It played a crucial role in driving financial inclusion, as individuals and businesses in the unbanked and underbanked areas, where cash was dominant, received digital access to financial services.

Mobile money operators and the government collaborated to make it easier for people to open accounts, transfer money, receive money, and access other financial services through mobile phones. McKinsey reported an increase in the number of digital payment platforms as governments, financial institutions, and non-financial institutions partnered to launch payment applications. In Kenya, for example, Safaricom partnered with the National Social Security Fund to enable customers to make service charge payments through their M-Pesa accounts.

Safaricom, MTN, Orange, Airtel, and other mobile money operators witnessed massive adoptions as they waived transaction fees to encourage mobile money adoption. This expansion continued even after the pandemic, as people experienced the convenience, affordability and security of mobile money services.

Growth of E-commerce

Before the pandemic, e-commerce in Africa wasn’t as popular. People like to visit physical stores or markets to examine what they want to buy before making payments. However, the e-commerce sector witnessed significant growth as lockdowns and social distancing gave people no options but to seek other ways to make purchases.

Existing e-commerce platforms like Jumia, SafeBoda, and Konga witnessed increased patronage. Many physical businesses also shifted their businesses online to survive and avoid losing their customers to competitors.

The growth in e-commerce in Africa improved payment infrastructure to support secure online transactions.

Fintech Innovation

The African fintech industry is another sector that was impacted by the COVID-19 pandemic. To meet the changing needs of individuals and businesses during the pandemic, especially with regard to digital systems, fintech companies developed solutions.

Many solutions spanning people’s digital needs have been developed, from digital lending platforms to online payment gateways, mobile banking apps, virtual meeting platforms, etc. All these solutions facilitated online payments in Africa, leading to a more robust payment infrastructure across the continent.

Challenges and Inequalities

While it facilitated fintech innovation and accelerated the adoption of digital payments, the COVID-19 pandemic highlighted the challenges and inequalities in the African payment infrastructure.

Many people, especially those in rural and underserved communities, were excluded from the financial system due to the unavailability of the necessary technology and infrastructure to participate. There was no system in place to enable them to make card transactions, e-commerce payments, point-of-sale (POS) transactions, digital banking payments, transfers, and take advantage of remittances and cross-border payments.

COVID-19 highlighted all these, forcing governments and other organizations to put measures in place to give those in rural and underserved communities access to digital payment services.

Cybersecurity Concerns

The shift from cash transactions to digital transactions due to the COVID-19 pandemic also raised concerns about another issue, which is cyber threats and fraud.

A Statista survey revealed a global increase in cyber fraud risk since the coronavirus outbreak. As of May 2020, 45% of the survey respondents reported a significant increase in cyber fraud risk, and 60% expected a significant increase over the next twelve months.

Also, the Global Cybersecurity Outlook 2022 by the World Economic Forum reported a 31% increase in the number of cyber-attacks per organization in 2021 compared to 2020.

With people learning to do almost everything online, from work to meetings to payments, it’s safe to say that COVID-19 has also impacted the cybersecurity industry.


The COVID-19 pandemic significantly impacted the African payment infrastructure by accelerating payments, facilitating the expansion of mobile money, spurring fintech innovation, and leading to the growth of e-commerce in the region. It also highlighted the challenges and inequalities in the system and the cybersecurity concerns that became worrisome during and after the pandemic.

While the changes have brought about positive shifts towards financial inclusion, there’s a great need to address the disparities in technology, digital financial services access, and cybersecurity concerns.

With an understanding of the positive and negative impacts of the COVID-19 pandemic, it’s easier to build a robust and secure payment infrastructure that ensures every African has secure access to digital financial services.


The Impact of COVID-19 on Payment Infrastructure in Africa

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