Innovative Credit Models In Africa

This report analyzes digital credit innovations in sub-Saharan Africa, focusing on five key countries. It identifies seven primary innovation models—including telco-based lending, scoretechs, and invoicetechs—designed to overcome barriers like lack of collateral and poor credit history. While telco-based lending has significantly expanded access, the report notes risks of over-indebtedness and highlights the need for patient capital, regulatory sandboxes, and improved data privacy to ensure the sustainability of these models.

• Domestic credit provided by the financial sector in sub-Saharan Africa (SSA) was 39% of GDP in 2018, which is significantly lower than South Asia's 69% in the same year. The region's credit sector is marked by high non-performing loans (NPLs) exceeding 10% in several countries and returns on assets (ROAs) below 2% in many.
• Telco-based lending is the most successful innovation for increasing household credit access, particularly in East Africa, with over 30 million subscribers. However, this ease of access has led to increased indebtedness, with 35% of digital borrowers reported to be borrowing from multiple lenders.

APA

FSD Africa (n.d.). Innovative Credit Models In Africa. https://fsdafrica.org/wp-content/uploads/2025/05/20-05-22-FSDA-Intellecap-Report.pdf

Chicago

FSD Africa. Innovative Credit Models In Africa. n.d. https://fsdafrica.org/wp-content/uploads/2025/05/20-05-22-FSDA-Intellecap-Report.pdf.

Wikipedia

{{cite report |author=FSD Africa |title=Innovative Credit Models In Africa |url=https://fsdafrica.org/wp-content/uploads/2025/05/20-05-22-FSDA-Intellecap-Report.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{fsdafricandinnovative, author = {{FSD Africa}}, title = {{Innovative Credit Models In Africa}}, institution = {FSD Africa}, url = {https://fsdafrica.org/wp-content/uploads/2025/05/20-05-22-FSDA-Intellecap-Report.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }