IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/128972.html

Digital finance transformation and digital financial inclusion in Africa: the promise and challenges

Author

Listed:
  • Ozili, Peterson K

Abstract

Accelerating digital finance transformation initiatives across African countries is essential to develop the African continent. Using the conceptual discourse method and the global findex data, this article explores the on-going digital finance transformation in Africa, the benefits for digital financial inclusion in Africa as well as the challenges that lie ahead. The article emphasises the importance of the digital finance transformation in Africa and urges for coordination with stakeholders to accelerate the use of digital financial services in African countries. It also emphasises the need to balance digital finance transformation initiatives with the risks. This study contributes to ongoing discussions about the role of digital finance in transforming nations.

Suggested Citation

  • Ozili, Peterson K, 2026. "Digital finance transformation and digital financial inclusion in Africa: the promise and challenges," MPRA Paper 128972, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:128972
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/128972/1/MPRA_paper_128972.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Peterson K. Ozili, 2023. "Digital finance research and developments around the world: a literature review," International Journal of Business Forecasting and Marketing Intelligence, Inderscience Enterprises Ltd, vol. 8(1), pages 35-51.
    2. Ozili, Peterson K, 2025. "Digital Public Infrastructure: Concepts, Global Efforts, Benefits, Challenges, and Success Stories," MPRA Paper 125029, University Library of Munich, Germany.
    3. Peterson K. Ozili, 2018. "Impact of digital finance on financial inclusion and stability," Borsa Istanbul Review, Research and Business Development Department, Borsa Istanbul, vol. 18(4), pages 329-340, December.
    4. Massimo Preziuso & Franziska Koefer & Michel Ehrenhard, 2023. "Open banking and inclusive finance in the European Union: perspectives from the Dutch stakeholder ecosystem," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-27, December.
    5. Kass-Hanna, Josephine & Lyons, Angela C. & Liu, Fan, 2022. "Building financial resilience through financial and digital literacy in South Asia and Sub-Saharan Africa," Emerging Markets Review, Elsevier, vol. 51(PA).
    6. Sekantsi, Lira Peter, 2019. "Digital financial services uptake in Africa and its role in financial inclusion of women," Journal of Digital Banking, Henry Stewart Publications, vol. 4(2), pages 161-174, September.
    7. Preziuso, Massimo & Koefer, Franziska & Ehrenhard, Michel, 2023. "Open banking and inclusive finance in the European Union: Perspectives from the Dutch stakeholder ecosystem," EIF Working Paper Series 2023/94, European Investment Fund (EIF).
    8. Ozili, Peterson Kitakogelu, 2018. "Impact of Digital Finance on Financial Inclusion and Stability," MPRA Paper 84771, University Library of Munich, Germany.
    9. Njuguna Ndung'u & Alex Oguso, 2023. "Digital technology and innovation in Africa: leapfrogging in finance," Chapters, in: Ethné Swartz & Caren B. Scheepers & Adam Lindgreen & Shumaila Yousafzai & Marianne Matthee (ed.), Technological Leapfrogging and Innovation in Africa, chapter 5, pages 89-111, Edward Elgar Publishing.
    10. Mensah, Sabine, 2024. "The role of public-sector-led inclusive instant payment systems for growing the digital payments industry in Africa," Journal of Payments Strategy & Systems, Henry Stewart Publications, vol. 18(3), pages 291-308, September.
    11. Ikechukwu Kelikume, 2021. "Digital financial inclusion, informal economy and poverty reduction in Africa," Journal of Enterprising Communities: People and Places in the Global Economy, Emerald Group Publishing Limited, vol. 15(4), pages 626-640, February.
    12. Yang, Yang & Lin, Zibo & Xu, Zhaoyi & Liu, Shuwen, 2024. "The impact of digital finance on regional economic resilience," Pacific-Basin Finance Journal, Elsevier, vol. 85(C).
    13. Bachrudin K Una & Hendi Yogi Prabowo, 2022. "Fintech lending fraud prevention strategy: A case study," Journal of Contemporary Accounting, Master in Accounting Program, Faculty of Business & Economics, Universitas Islam Indonesia, Yogyakarta, Indonesia, vol. 4(1), pages 37-52.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Decai Tang & Ziqian Zhao & Jiannan Li & Valentina Boamah, 2024. "Research on coupling coordination degree of digital finance and economic resilience in the Yangtze River Economic Belt," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 120(15), pages 14279-14309, December.
    2. Cheng, Rui & Yue, Wenzhong, 2026. "How does digital finance influence the share of labor income? Evidence from China," The Quarterly Review of Economics and Finance, Elsevier, vol. 106(C).
    3. Ren, Xiaohang & Zeng, Gudian & Zhao, Yang, 2023. "Digital finance and corporate ESG performance: Empirical evidence from listed companies in China," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).
    4. Jie Weng & Wang Li & Jie Zhou, 2025. "Can Digital Inclusive Finance Safeguard the Middle Class? A Study Based on Chinese Household Data," SAGE Open, , vol. 15(2), pages 21582440251, June.
    5. Ullah, Saif & Liew, Chee Yoong & Nobanee, Haitham, 2025. "Digital transactions and financial development: The moderating role of global integration across income levels," International Review of Economics & Finance, Elsevier, vol. 98(C).
    6. Lwanga Elizabeth Nanziri & Paul Terna Gbahabo & Daniel Ofori-Sasu, 2026. "Open banking and financial inclusion in South Africa," Working Papers 11100, South African Reserve Bank.
    7. Tae-Young Pak & Swarn Chatterjee & Youngjoo Choung, 2026. "Navigating digital finance: how digital financial literacy influences digital financial services use and benefits in Korea," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 12(1), pages 1-33, December.
    8. repec:bcp:journl:v:9:y:2025:i:10:p:9777-9793 is not listed on IDEAS
    9. Hasan, Morshadul & Hoque, Ariful & Abedin, Mohammad Zoynul & Gasbarro, Dominic, 2024. "FinTech and sustainable development: A systematic thematic analysis using human- and machine-generated processing," International Review of Financial Analysis, Elsevier, vol. 95(PC).
    10. Pak, Tae‐Young & Chatterjee, Swarn & Choung, Youngjoo, 2026. "Digital financial services use and life satisfaction: Is financial well‐being a mediator?," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 50(1), pages 1-16.
    11. Aamir Aijaz Syed, 2024. "The moderating role of governance, banking regulation, and supervision on shadow economy, financial inclusion, and financial stability nexus: a case of G5 economies," Economic Change and Restructuring, Springer, vol. 57(6), pages 1-31, December.
    12. Lanxin Sun & Zhenting Lin & Baowei Lai, 2025. "Examining the Impact of Digital Inclusive Finance on Urban and Rural Consumption Patterns: Insights from China Household Finance Survey in 11 Coastal Regions," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(3), pages 12809-12842, September.
    13. Xin, Ling & Han, Yunge & Cui, Xiaoyan, 2025. "Does digital finance facilitate enterprises’ overseas expansion? Evidence from Chinese A—Share listed companies," Finance Research Letters, Elsevier, vol. 85(PA).
    14. Ozili, Peterson K, 2023. "Central bank digital currency, poverty reduction and the United Nations sustainable development goals," MPRA Paper 117000, University Library of Munich, Germany.
    15. Kandpal, Vinay & Ozili, Peterson K & Jeyanthi, Mary & Ranjan, Deepak & Chandra, Deep, 2025. "Digital finance and future of banks and financial services," MPRA Paper 124267, University Library of Munich, Germany.
    16. Chen Luo & Wenwen Yu & Lindong Li & Aizhi Li & Jinbo Du, 2026. "How does digital finance affect electricity consumption? an empirical analysis of the Yangtze River Economic Belt of China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 28(3), pages 6677-6694, March.
    17. Guangshun Xu & Lin Feng & Wenzheng Wang & Qiaohui Liang, 2024. "Digital Financial Literacy and Rural Income Inequality," SAGE Open, , vol. 14(3), pages 21582440241, September.
    18. Dongjing Chen & Xiaotong Guo, 2023. "Impact of the Digital Economy and Financial Development on Residents’ Consumption Upgrading: Evidence from Mainland China," Sustainability, MDPI, vol. 15(10), pages 1-25, May.
    19. Osakwe, Christian Nedu & Ogunmokun, Oluwatobi A. & Elgammal, Islam & Kwarteng, Michael Adu, 2025. "Individuals' attitudes and their adoption intentions of central bank digital currency: Combining theories and analytics for deeper insights," Technological Forecasting and Social Change, Elsevier, vol. 210(C).
    20. Rishika Khetan & Varda Sardana & Shubham Singhania & Jagvinder Singh, 2025. "Financial stability through a global perspective: an in-depth integrative review," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 16(8), pages 2912-2929, August.
    21. Ruixin Su & Tong Zheng & Yuzhao Zhong & Weizhou Zhong, 2023. "Role of Digital Inclusive Finance for High-Quality Business Development: A Study of China’s “Five Development Concept” Policy," Sustainability, MDPI, vol. 15(15), pages 1-21, August.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:128972. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.