While digital lending and more broad digital banking services can improve financial inclusion in sub-Saharan Africa and other regions such as Southeast Asia, there has also been some criticism of predatory lending terms and extremely high interest rates, leading Kenya and other nations to more strictly regulate the industry. Studies have also found there can be a gender gap when looking at access to mobile money and other digital banking services, with women still being less likely to have a bank account or own a phone than men.

Micro Loans and COVID-19 in sub-Saharan Africa

With mobile-based lending already on the rise in countries such as Kenya and Nigeria, it is expected that the economic turmoil surrounding COVID-19 will increase demand for loans. GeoPoll’s study on the financial impact of coronavirus in sub-Saharan Africa found that over three-quarters of workers had experienced a decrease in income due to COVID-19, and that the effects of the virus are most pronounced amongst informal workers and those earning lower incomes.

The study also found that nearly half of respondents had taken out a loan specifically to cover coronavirus-related expenses, which could result in negative economic impacts if people are unable to repay those loans. Concern over paying expenses due to COVID-19 was high for all respondents, with those in the informal economy more likely to be using savings and loans from banks or friends and family to cover expenses during the pandemic.

Loan Usage and Amount 

As part of the same financial study, GeoPoll collected additional information on loan usage in Kenya, Nigeria, Mozambique, and South Africa. Looking at all four countries we found that about half of all respondents are currently paying off a loan, with this number being highest in Kenya, at 68%, and lowest in South Africa, at 39%. This is likely due to Kenya being at the forefront of mobile-based lending and financial services for the past decade and is in line with the Digital Lending Association of Kenya’s findings.

The older age groups are more likely to be paying off loans than those aged 18-25, of which 42% state they are paying off loans, compared to 59% of those ages 36 and above. We also find that males are more likely than females to be paying off loans, with 54% of males and 48% of females across all countries paying off loans. Looking at loan usage by income level and employment type, we find that informal workers are less likely than formal workers to be paying off loans. This could be due to the fact that informal workers still often lack access to financial services, even with the proliferation of digital lending firms.

Those who reported that they are paying off a loan were asked how much they still owe for all outstanding loans in an open-ended question, which was then coded and put into ranges for each country approximating $0-50, $51-100, $101-250, $251-500, $501-1000, $1001-2000, $2001-5000, and above $5000 USD. From these ranges we found that almost 70% had loan amounts of up to $500, while just 10% had outstanding loans in amounts equivalent of $2000 USD or higher. The most common loan amount was $101-250, which 21% of those who have outstanding loans fell into.

Loan amounts varied by age, with the younger age groups reporting smaller outstanding loan amounts; 49% of those age 18-25 owed up to $100, compared to 34% of those aged 26-35 and 16% of those aged 36 and older. Given that those aged 18-25 were also found less likely to be responsible for paying expenses and more likely to be students or unemployed than older groups, this demonstrates that the youth may not yet need large loans, and when they do take out loans they are doing so in relatively small amounts.

Females also take out loans in lower amounts, with 36% of females taking out loans up to $100, compared to 26% of males. The most common loan range for females was $0-50, at 22%, while the most common range for males was $101-250, at 23%. South Africans are more likely to take out loans in higher amounts; While only 27% of respondents in South Africa owe less than $250, 58% of those in Kenya, 61% of those in Mozambique, and 55% of those in Nigeria fall into the same bracket. Those in Mozambique are most likely to take out loans up to $50, with almost a quarter of respondents reporting that range.

Data on Mobile Lending and Micro Loans

GeoPoll has conducted studies in over 80 countries around the globe and our team of research experts can help design and implement custom financial studies through our remote research modes, which include CATI voice calls, SMS and mobile web surveys. To collect your own data on digital lending, microfinance, financial inclusion, and related topics in sub-Saharan Africa, Asia, or Latin America, contact us today. 

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Data Highlights: Top Brands in Africa

Despite talk of a growing consumer class and increase in the prominence of local African brands, this year’s ranking had the lowest percent of African brands since Brand Africa’s launch in 2010, with just 13% of brands in the top 100 being from Africa. Instead, brands such as Nike and Nestlé, that are headquartered in North America and Europe, along with Asian brands including technology giants Samsung and Techno, dominated the list. Sports apparel brands and technology brands, in particular mobile phone makers, were found to be the most popular brands in Africa in 2020. Nike was the top brand for the second year, with Adidas coming in at number two and Samsung in third place.

South Africa’s telecom brand, MTN, was the highest-ranking African entry, coming in at number seven. However, in a separate prompted question that specifically asked about African brands, Nigeria’s Dangote, a leading multinational corporation with sugar, flour, and oil & gas subsidiaries, came in on top. Other African brands included Glo telecom, media company DSTV, and retail company Shoprite.

The full list of top brands in Africa is available to view here: Top 100 Brands in Africa 2020

Top FMCG brands in Africa

The Fast Moving Consumer Goods (FMCG) sector continues to grow in Africa, with global brands such as Coca-Cola investing more in the region. This year’s rankings find Coca-Cola to be the top FMCG brand in Africa, ranked number four, and competitor Pepsi comes in at number 16. Other FMCG brands in the top 100 include Danone, Unilever, and Nivea. The top three alcoholic brands were Ireland’s Guinness, followed by two local beer brands, Nigeria’s Star Beer and Kenya’s Tusker. Coca-Cola, Pepsi, and Fanta, all from the USA, are the top three non-alcoholic beverage brands, while Nestle, Dangote, and Unilever are the top three consumer, non-cyclical brands.

Top Media Brands in Africa

Given the importance of media in Africa, Brand Africa asks a specific question on top media brands in Africa. This year’s top media brands demonstrate the dominance of international news channels, with BBC, CNN, Al Jazeera, and ITV all within the top five, along with South Africa’s DSTV, which was the second most admired media brand. Social networks and websites including Facebook, YouTube, Google, and Instagram were also represented in the list of top media brands.

Top Finance Brands in Africa

The financial sector has grown enormously in Africa in the past several years, with both mobile money brands and traditional banks vying for customers. For this reason, Brand Africa also asks a specific question on top brands in the financial services sector. Unlike the top media list, which was dominated by non-African brands, the financial services list shows the prominence of local banking brands throughout Africa. Nigerian and South African services are well-represented in the top financial brands list, with Nigeria’s GTB and First Bank taking the number one and two spot, and South Africa’s ABSA and First National Bank coming in at number five and six. Togo’s Ecobank, which was ranked number one last year, was the third most popular financial brand in 2020.

Conduct Brand Research in Africa

GeoPoll conducts research for top brands throughout Africa by remote, mobile-based methods including SMS, voice call, mobile web, and mobile application. If you’re interested in conducting your own study on your brand’s health or key performance indicators, please contact us today.

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Cyclone Idai Disaster Response

Following Cyclone Idai, which devastated areas of Mozambique, Malawi, and Zimbabwe, GeoPoll rapidly deployed an SMS survey to the hardest-hit areas near the coast of Mozambique. By using SMS, which regains connectivity following a natural disaster more quickly than other communications methods, we were able to gather information on infrastructure damage, aid presence, and aid need within days of the cyclone touching down. Our first report showed widespread destruction and a strong need for aid, especially in the city of Beira. Our second report on Cyclone Idai, conducted in the weeks following the Cyclone, examined the fear of Cholera spreading and the impact the hurricane had on livelihoods as communities continued to rebuild.

Gathering Feedback on HIV Self-Test Kits in Kenya

With PSI International, GeoPoll used our SMS capabilities to gather direct feedback from consumers using HIV self-test kits. Using text-in triggers on the product packaging, GeoPoll and PSI were able to reach those who had used HIV self-test kits in order to better understand experiences with these products. Read more.

AFCON 2019 Data

As one of the biggest sporting events in Africa, interest in the African Cup of Nations ran high throughout the months of June and July 2019. Just prior to the start of the games, GeoPoll produced a free report looking at the popularity of football, planned viewership of AFCON, and engagement in sports betting around AFCON. As the games were ongoing, GeoPoll Audience Measurement captured viewership metrics in multiple countries in Africa including Benin and Cote D’Ivoire.

Data on Betting in Kenya

2019 was a critical year for betting in Kenya, as it was announced that betting, which had grown in popularity in Kenya due to the ease of mobile-based betting applications, would be more strongly regulated throughout the country in July. In addition to our data on betting related to AFCON, GeoPoll conducted a study with Ipsos on the impact the new regulations around gambling would have on the industry and economy, which can be accessed for free here.

Financial Services in Africa Report

As the financial services industry continues to grow throughout Africa, GeoPoll conducted a wide-reaching study in six nations on how youth engage with financial services, save, and invest. Results examine share of wallet for common spending categories, the popularity of cash versus other payment methods, and how savings and investment cultures differ throughout Africa. Download the free report on the state of financial services in sub-Saharan Africa here.

Let GeoPoll Help With Your Research Needs

GeoPoll is the leader in conducting research through the mobile phone in Africa, Asia, and Latin America. To learn more about our research methodologies or get a quote for your research project, please contact us today.

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In this post, we will provide details on the study itself, provide background information on why this study was conducted, and explain what information is included in the report.

Details on GeoPoll’s Study

In order to better understand the state of financial services in sub-Saharan Africa today, GeoPoll conducted a study on the use of, access to, and challenges surrounding financial services in the region.

Data for the report was collected from over 2,000 respondents in Kenya, Uganda, Tanzania, Ghana, Nigeria, and Cote d’Ivoire, and includes insights on:

• Income
• Purchase types and share of wallet
• Payment types
• Savings culture & practices
• Investment culture & practices

Why GeoPoll Conducted This Study: A Background on Financial Inclusion in Sub-Saharan Africa

Since the reformation of financial sectors throughout Africa in the 1990s, there has been a focus on economic development in sub-Saharan Africa through the expansion of financial services. More recently, the introduction of digital financial services has spurred further growth in the industry; traditional retail banks have adapted to provide more robust services, while innovations like mobile money have emerged. Additionally, global insurers, such as Allianz, have begun expanding in haste into markets in sub-Saharan Africa due to potential seen in the growing consumer class, the high percentage of youths, and the increase in infrastructure projects by both national and foreign parties.

Despite this, as the global financial sector looks to expand into an under-tapped market and Africans become increasingly savvy with their finances, the majority of sub-Saharan Africa’s population remains unbanked.

Traditionally, institutions in sub-Saharan Africa reserved formal banking for the upper-class, which made financial inclusion in the region challenging. Today, there are still issues that impede financial inclusion left over from the class-centered banking tradition, and mistrust of banks and the prevalence of informal trade also contribute to low financial inclusion.

However, there are signs that the use of formal financial services is increasing; McKinsey predicts that by 2022, over half of Africans will have access to banking services. This growth —spurred in part by the massive uptake of mobile money services like M-Pesa—is expected to continue and lead to more investment by the banking sector in the region, and ultimately close the gaps seen in financial inclusion between classes.

It is clear that financial services in sub-Saharan Africa are changing rapidly; however, as expected in such a diverse continent, the availability and use of financial services varies widely by country. In response to the shifts, continual growth, and variation across sub-Saharan Africa in the finance sector, GeoPoll embarked on a study to examine how Africa’s youth in six nations are engaging with financial services.

Report Details: How Youth in Six African Nations Spend, Save, and Invest

In this report, GeoPoll presents the findings from an extensive research study to inform players in financial services on where populations currently stand. Each section provides data and analysis that serve as a barometer for the financial services space in each of the countries studied. In time, this report will also serve as a benchmark of growth as the financial sector looks back upon progress in the years to come.

GeoPoll presents the results from this study based on data collected from youth populations in Kenya, Tanzania, Uganda, Ghana, Nigeria, and Côte d’Ivoire. Topics studied include income streams, spending habits, payment types, investment decisions, savings patterns, and more. A mobile web survey was used to conduct the study. Thus, the data focuses on populations who have access to a mobile phone and basic internet services, which often represents the target population for retail banks and mobile money services.

Download your copy of the report for free, now!

To request pricing for a study of your own or a custom report on all of the data collected during this study, please contact us at [email protected].

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