REPORT | Total Investments in African Fintech Startups Declined by 52% in 2023

African fintech startups saw a sharp decrease in venture capital investments in 2023, a new report reveals.

According to African Private Capital Association’s (AVCA) 2023 African Private Capital Activity Report, across all asset classes, financial technology investments decreased to 76 deals, totalling $1.3 billion, marking annual declines of 52% in volume and 27% in value.

Globally, fintech investment saw a 48% decrease in funding and a 38% decrease in the number of deals in 2023.

“Investors with a focus on the sector approached the year [2023] cautiously due to ongoing macro-economic uncertainties, which dampened discretionary spending and deal-making,” said AVCA.

According to a newer Q1 2024 report by CB Insights, the first quarter of the year was still not better for fintech startups across the word, with a 16% decline compared to the previous quarter.

Africa’s wider financials sector, including banks, diversified financials & capital markets, and insurance saw a decline in investments according to AVCA with the largest year-over-year decline in investment volume (47%) across all sectors.

“In aggregate, the financial sector recorded 96 private capital investments with a total reported value of $1.4 billion. This represented the largest year-over-year decline in investment volume at 47% across all sectors, and the second-largest drop in value at 43%, marking the lowest values for the sector since 2021,” AVCA said.

“While all regions experienced declines in financial sector investments, West Africa felt the impact most significantly given the region’s deep ties to the sector. Financial investments in West Africa experienced a more than 2x year-over year decrease in volume and over a 5x decrease in value.”

Overall, the continent witnessed a significant decrease in private capital activity across all sectors, coming to $5.9 billion representing a 28% year-over-year decrease in volume and a 22% year-over-year decline in value.

 Total Volume of Private Capital Deals in Africa, by Year, 2012 – 2023The venture capital (VC) sector played a leading role with 68% of all private capital investment in Africa. This trend reflects the continued interest of investors in backing tech-driven businesses across the continent’s rapidly growing markets since 2015.

Still, venture capital investments in financials dropped by over 50%, from 161 deals in 2022 to 75 in 2023.

Following venture capital (VC), infrastructure also experienced a notable upswing in investment values, reaching $1.8 billion, triple its previous figure. This growth was primarily propelled by investments in renewable energy projects.


• The southern Africa region drew the highest volume (26%) and value of deals (44%) with South Africa in front amidst growth in sectors like IT, software, logistics, and transportation.
• North Africa accounted for 15% of the total value
• East Africa (14% )
• West Africa (11%)
• Central Africa (1%) while
• Entities with overseas headquarters but operating in Africa secured 15%

Among the reasons given for the downturn in the report include inflation, depreciation of several African currencies, and global supply chain disruptions.