Fintech event in Africa advocates for "Passporting" to enhance digitized financial services across the continent
The Africa Fintech Festival, a gathering of regulators, industry leaders, and fintech entrepreneurs, recently concluded with a call to action for a more conducive regulatory environment for fintech innovation. One of the key topics discussed was the potential implementation of a passporting model for fintech regulations across Africa.
Passporting, argued to be a form of smart regulation, fosters innovation and growth while maintaining essential oversight. Adrian Pillay, VP Sales at Provenir, emphasized that this model provides a practical solution for fintech companies, allowing them to focus more on innovation and customer service rather than regulatory compliance.
The successful implementation of similar models in other regions, such as the European Union, has facilitated the flourishing of financial services across member states. In Africa, passporting could streamline the licensing process for fintech companies operating in multiple countries, reducing redundancy and inefficiencies that currently hinder their expansion.
The passporting model involves regulators in African countries recognizing and trusting fintech licenses issued by other African nations. Kagisho Dachabe, President of the Fintech Association of South Africa and Africa Fintech Network Board Member, stressed that the implementation of passporting requires a concerted effort from all stakeholders to standardize regulations and ensure mutual trust and cooperation.
Leon Kiptum, Senior Vice President for East Africa at Flutterwave, expressed support for passporting and suggested that central banks in Africa need to communicate and agree on standards. Sebie Salim, Co-Founder of Eclectics International, proposed advocating for continent-wide passporting through the African Union or regional collaborations like those in West Africa.
In East Africa, lobbying efforts can be channeled through the East African Community organization. The most notable lobbying efforts for a passporting model to simplify fintech registration and licensing across multiple African countries are linked to initiatives fostering regional trust corridors and digital cooperation.
The Africa Fintech Network, a fintech lobby group, could help shape the standards for passporting. The African fintech community is optimistic that adopting a similar approach could yield comparable results. Key speakers at the festival emphasized the potential economic advantages of passporting, such as increased investment, job creation, and enhanced financial inclusion.
As Africa continues to position itself as a global fintech hub, passporting could play a crucial role in unlocking the continent's full potential. Panelists emphasized the need for a harmonized regulatory approach and increased cooperation among African regulatory bodies. The Africa Fintech Festival concluded with a call to action for regulators and industry players to work together towards a more efficient and innovative fintech landscape in Africa.
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