Key regions: Singapore, United States, Israel, United Kingdom, Australia
Marketplace lending (consumer) in Africa is experiencing significant growth and development. As more consumers in the region gain access to the internet and mobile technology, the demand for online lending platforms has increased.
Customer preferences: A key driver of the growth in the marketplace lending market in Africa is the changing preferences of consumers. Traditional banks have often been inaccessible to a large portion of the population due to high interest rates, stringent requirements, and a lack of physical branches in rural areas. As a result, many consumers are turning to online lending platforms for quick and convenient access to credit. These platforms offer a streamlined application process, competitive interest rates, and flexible repayment options, making them an attractive alternative to traditional banks.
Trends in the market: One of the key trends in the marketplace lending market in Africa is the rise of peer-to-peer (P2P) lending platforms. These platforms connect borrowers directly with lenders, cutting out the middleman and reducing costs for both parties. P2P lending has gained popularity in Africa due to its ability to provide credit to underserved populations and support small businesses. Additionally, the use of alternative credit scoring models, such as analyzing mobile phone data and social media profiles, is becoming more prevalent in the region. This allows lenders to assess the creditworthiness of borrowers who may not have a traditional credit history.
Local special circumstances: Africa is a diverse continent with unique local circumstances that impact the marketplace lending market. One such circumstance is the prevalence of mobile money services. Mobile money platforms, such as M-Pesa in Kenya, have revolutionized the way people in Africa manage their finances. These platforms allow users to send and receive money, pay bills, and access other financial services using their mobile phones. The integration of mobile money with marketplace lending platforms has made it easier for individuals to access credit and repay loans, further driving the growth of the market.
Underlying macroeconomic factors: Several macroeconomic factors contribute to the development of the marketplace lending market in Africa. Economic growth and urbanization are driving the expansion of the middle class, creating a larger pool of potential borrowers. Additionally, the high rates of smartphone penetration and internet connectivity in many African countries provide a solid foundation for the growth of online lending platforms. Furthermore, the lack of traditional banking infrastructure in some regions has created a gap in the market that marketplace lenders are filling. In conclusion, the marketplace lending (consumer) market in Africa is experiencing significant growth and development due to changing customer preferences, the rise of P2P lending platforms, local special circumstances such as the prevalence of mobile money services, and underlying macroeconomic factors such as economic growth and technological advancements. As more consumers in Africa gain access to online lending platforms, the market is expected to continue its upward trajectory.
Data coverage:
The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.Modeling approach / Market size:
Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.Additional notes:
The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.
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