Many African banks own sophisticated payment platforms but fail to leverage them for revenue and customer experience. Aligning technology with clear business opportunities could unlock new streams and accelerate digital finance across the continent.
The core issue is not the lack of infrastructure. Over the past five years, major banks have rolled out real‑time gross settlement (RTGS) engines, QR‑code payment acceptance, and cross‑border settlement hubs. These platforms can process millions of transactions daily, support tokenised cards and enable instant payouts to merchants. Yet, usage metrics reveal that only a fraction of the available features are active in everyday banking operations.
Bautista argues that banks treat technology as a compliance checkbox rather than a growth lever. “You can buy the most sophisticated stack, but if the business case isn’t defined, the investment sits idle,” he said. The result is a market where fintech startups and mobile money operators capture the innovative edge, while legacy banks watch their own tools under‑utilised.
The practical fallout is two‑fold. First, banks miss out on new fee income from value‑added services such as dynamic QR generation, subscription‑based invoicing and API‑as‑a‑service for third‑party developers. Second, customers experience fragmented digital journeys, often forced to switch between a bank’s app and a fintech’s platform for basic tasks like bill payment or peer‑to‑peer transfers.
- Transaction volume: In 2023, African banks processed roughly 2.4 billion digital payments, a 27 % YoY increase. Only 38 % of those transactions used bank‑owned APIs; the rest were routed through external providers.
- Revenue gap: Average fee per digital transaction sits at $0.12. If banks could capture an additional 20 % of the API market, they stand to earn $57 million annually across the continent.
- Cost of idle tech: Maintenance of under‑used platforms costs banks an estimated $150 million per year in licensing, support and staff overhead.
- Fintech competition: Fintechs now control 45 % of mobile money volume, leveraging lean tech stacks and agile product cycles. Their average time‑to‑market for new payment features is 6 weeks, compared with banks’ 4‑6 months.
These figures illustrate a stark mismatch between the capital sunk into payment infrastructure and the upside that could be realised with better productisation.
The story reflects a broader tension in Africa’s digital finance evolution: legacy institutions versus agile newcomers. Banks inherited heavy, monolithic systems designed for branch‑centric operations. When the pandemic accelerated digital adoption, many banks simply digitised existing processes instead of re‑architecting them for open, API‑first models.
Regulators have begun to push for open banking frameworks, but implementation remains uneven. In Nigeria, the Central Bank’s “API sandbox” launched in 2022, yet only 12 % of licensed banks have published production‑grade APIs. Kenya’s Payments System Act encourages data sharing, but banks cite legacy risk and data‑privacy concerns as barriers.
The cultural aspect cannot be ignored. Banking executives often view technology departments as cost centres, not profit centres. This mindset curtails investment in product management, user experience design and partnership teams that could translate technical capability into market‑ready services.
> “Modernisation should be driven by business priorities and opportunities, not by the allure of shiny tech,” Bautista warned during the interview.
> “If you cannot articulate a clear revenue stream or customer benefit, the technology will simply sit on the shelf,” he added.
For banks to convert dormant tech into revenue, three strategic moves are essential.
1. Define clear use cases, Map each technology component to a monetisable service, such as merchant‑settlement APIs, payroll disbursement platforms or embedded finance for e‑commerce.
2. Build product teams, Shift from a purely engineering focus to cross‑functional squads that include product managers, designers and data analysts. This structure accelerates feature rollout and aligns development with market demand.
3. Open ecosystems, Publish sandbox APIs, invite fintechs to co‑create, and adopt revenue‑sharing models. An open ecosystem can turn a bank’s payment switch into a marketplace, generating fees from third‑party usage while expanding the bank’s brand reach.
Regional banking groups are already testing these approaches. A South African bank recently launched a B2B invoicing API that has attracted 300 SME clients within three months, generating $2.4 million in fees. In Kenya, a consortium of banks is piloting a cross‑border settlement hub that could reduce transaction costs by 30 % for East African merchants.
If the continent’s banks can replicate these pilots at scale, the cumulative effect would be a significant boost to digital financial inclusion and a stronger competitive stance against fintech disruptors.
African banks possess sophisticated payment infrastructure, yet most of it remains under‑utilised. Aligning technology with concrete business opportunitiesthrough defined use cases, product‑centric teams and open ecosystemscould unlock tens of millions in new revenue and improve customer experiences. The next wave of digital finance growth on the continent will likely be driven not by new tech purchases, but by smarter, revenue‑focused deployment of the tools already in banks’ vaults.