Ecobank

SSA refers to the region of the African continent located south of the Sahara Desert. It encompasses 48 countries with a population of approximately 1.1 billion people representing diverse ethnic groups, languages, and cultures. SSA is rich in natural resources, including oil, minerals, and fertile land. However, the region faces numerous challenges, such as poverty, inequality, political instability, and conflicts, which have impeded its economic and social development.

The economic growth rate of SSA is projected to rebound to 3.4% in 2021 after contracting by 1.9% in 2020 due to the COVID-19 pandemic. The average inflation rate in SSA was 9.8% in 2020, up from 8.1% in 2019. However, it is expected to moderate to 8.1% in 2021. Foreign direct investment (FDI) in SSA declined to USD 29bn in 2020 due to the impact of the COVID-19 pandemic, which rebounded to USD 73bn in 2021. The average debt-to-GDP ratio for SSA is expected to increase from 58.7% in 2020 to 64.9% in 2021 due to the impact of the pandemic on public finances. The unemployment rate in SSA was 7.9% in 2020, but it is expected to rise to 8.5% in 2021 due to the impact of the pandemic on the job market.

The confluence of higher global interest rates, elevated sovereign debt spreads, and exchange rate depreciations, among other factors, has created a funding squeeze for many countries in SSA. This challenge comes on top of policy struggles from the ramifications of the COVID-19 pandemic and the cost-of-living crisis. Reflecting these considerations, economic activity in the region will remain subdued in 2023, with growth at 3.6% before rebounding to 4.2% in 2024, predicated on a global recovery, subsiding inflation, and the winding down of monetary policy tightening.

As of 2024, Sub-Saharan Africa’s banking sector remains diverse, with both local and international banks operating across the region. Total banking assets in the region were estimated at approximately USD 2.9 trillion, with South Africa, Nigeria, and Kenya being the largest markets.

Mobile money adoption has surged, driven by platforms like Kenya’s M-PESA, which has become one of the world’s most successful mobile money platforms. This innovation has played a key role in expanding financial inclusion, enabling millions to access banking services directly from their mobile phones. As of 2024, Sub-Saharan Africa accounted for over 1.1 billion of the 2.1 billion mobile money accounts registered globally, marking a 19% increase from the previous year. In 2023 alone, mobile money contributed approximately $190 billion to the region’s GDP, up from $150 billion in 2022 .

Fintech is also on the rise, with startups developing creative solutions to address financial inclusion challenges and improve access to finance. The regulatory environment for banking in Sub-Saharan Africa varies by country, with central banks in each nation overseeing the sector. However, there is a growing trend toward greater regulation and supervision to ensure stability and consumer protection as the sector evolves.