In Côte d’Ivoire, many individuals and small businesses are financially excluded, and access to finance can be a challenge. Women are especially at a disadvantage, although mobile money has helped to reduce the gender gap in access to financial services. According to the 2017 Global Findex database, which tracks financial inclusion and access to finance, only 41 percent of Côte d’Ivoire’s citizens had access to financial services. The study identified 37 Fintech initiatives, many of which are affected by a lack of funding, limited business and digital skills, as well as an unclear operating environment. Three key challenges prevent Côte d’Ivoire from fully reaping the benefits of a digital economy through the full participation of its citizens and businesses: (i) limited digital inclusion in rural areas; (ii) poor policy and regulation; and (iii) gaps in financing for private sector development.
Based on desk research, questionnaires and interviews, the study assessed the constraints to Fintech development. It suggested ways to improve digital financial inclusion for poor households and micro-entrepreneurs, including women. It specifically focused on the legal and policy framework, financial and telecommunications infrastructure, and the business environment for Fintech startups. This analytical work led to a multi-stakeholder workshop, as recommended by the Bank. The workshop aimed to improve the enabling environment for Fintechs, as well as boost financial inclusion. The event, organized on October 21-22, 2021, facilitated the creation of a Roadmap for 2022-2024 to improve the Fintech sector in Cote d’Ivoire. The workshop also proposed actions to undertake in four key areas: the legal and regulatory framework, access to finance, capacity building, and the organization of the Fintech ecosystem.
The study revealed the potential for the development of a new generation of financial service providers. It also identified the capacity-building needs of the Fintech companies. Over time, efforts for a more supportive environment are expected to promote private sector-led growth and the development of human capital in Côte d’Ivoire. Building on the study findings, the Agency for Financial Inclusion (APIF) took concrete steps in the form of stakeholder workshops, contributions to future regulations, as well as the organization of innovation fora to help Fintech companies access markets and finance by developing marketing ideas and strengthening business skills.
The study helped to identify a pronounced gender gap in the Fintech sector, finding that women led only 2 of the 37 Fintech companies operating in Côte d’Ivoire. It also found that most companies are active in urban areas, leaving rural parts of the country without access. The findings spurred several recommendations to work toward reducing both gender and urban-rural gaps in access to digital financial services. More specifically, the action plan laid out commitments to: (i) increase women’s interests in technology-based financial products; (ii) integrate financial education modules in literacy curricula for women; (iii) sensitize rural populations in the use of Fintech services and products; and (iv) support the creation of incubators in each district of the country.
It is expected that the results of these actions will help the country reach the financial inclusion objectives set forth in the newly approved project to “Enhance government effectiveness for improved public services” for Côte d’Ivoire.
Bank Group Contribution
The study was conducted under the Côte d’Ivoire Jobs and Economic Transformation Project that was approved in June 2021.
The Bank team worked with the Agence Française de Développement (AFD) to leverage funding for the Agency for Financial Inclusion. The AFD also played a key role in providing a technical review of the study.
Looking ahead, the Government plans to implement the 2022-2024 Roadmap to Improve Fintech in Cote d’Ivoire. In this regard, it incorporated major recommendations from the World Bank study, including actions to improve alternative finance, promote women-led Fintechs, as well as gender-focused product designs. The Roadmap is expected to contribute to ongoing work related to the revision of the enabling environment for Fintech in the West African Economic and Monetary Union (WAEMU). Efforts are being led by the Central Bank of West African States (BCEAO), including the creation of an innovation lab at the national level. Additionally, the Roadmap includes measures to build the capacity of Fintech business owners and strengthen Fintech support organizations, such as incubators. The Bank team also shared the report with regulators in Madagascar and Nigeria. Both countries have found the study useful and have requested the Bank’s support for a similar study using the same methodology. The Central Bank of Madagascar will host its first Fintech workshop on June 17, 2022, thanks to the joint support of the World Bank and the International Finance Corporation (IFC).
“As a female entrepreneur, I was pleased to have the opportunity to be part of the Regulatory Committee established by the Côte d’Ivoire Agency for Financial Inclusion (APIF) under this World Bank-supported initiative. The APIF is the first public institution to allow Fintechs in Côte d’Ivoire to have a voice. This initiative gathered key players of the financial services ecosystem, which jointly worked on a roadmap for Fintech development to accelerate innovation and financial access.” said Nadine Ebelle Kotto, Chief Executive Officer (CEO) of MQash. (MQash is a Fintech specialized in providing innovative market solutions in the payment industry).