Backbase and African Banker Publish Landmark Report on SME Banking – Africa’s Next Growth Segment

4d ago | Source: African Media Agency

Backbase, the global leader in AI-powered Banking technology, in partnership with African Banker magazine, has released the second edition of the Africa Digital Banking Experience Series 2025. This latest report, Small Business Banking: Africa’s Next Growth Segment, highlights how African banks are reimagining their role in supporting small and medium-sized enterprises (SMEs) through digital-first solutions.

Drawing on insights from a survey of 203 senior banking executives across 40 African countries, the report provides an in-depth, data-driven analysis of how banks are positioning SME banking at the heart of their growth strategies, leveraging mobile-first platforms, AI-driven lending, and tailored financial services.

Key findings from the report include:

SME banking emerging as a strategic priority: 83% of banks surveyed describe SME banking as “very” or “extremely” important, with significant or major investments planned
Mobile banking dominates SME offerings: 84% of banks now serve SMEs primarily through mobile platforms
Digital onboarding still lags: Only 42% of banks currently offer full digital account opening, highlighting a key bottleneck in SME financial inclusion
Bridging the digital literacy gap: 70% of banks surveyed provide workshops and training to SMEs, underlining their role in accelerating adoption
AI-driven lending on the rise: Nearly half (47.7%) of African banks now offer digital lending, with AI and predictive analytics enabling more inclusive and accurate credit decisions

The report also features real-world examples of how African institutions and fintech innovators are reshaping SME finance. From South Africa’s African Bank integrating AI-powered analytics into its SME platforms to Nigeria’s Moniepoint processing 800 million transactions monthly for small businesses, the case studies illustrate the scale and speed of digital disruption in the sector.

Heidi Custers, Global Strategy & Transformation Director at Backbase, commented: “SMEs are the backbone of Africa’s economies, and digital innovation is finally making it viable for banks to serve them at scale. What this report shows is that SME banking is no longer a niche, it is the next growth engine for the industry. By combining mobile-first platforms with AI-driven insights, African banks are turning financial inclusion into a profitable, sustainable strategy.”

The full report is now available at https://www.backbase.com/insights/reports/african-digital-banking-report-small-business-banking-africas-next-growth-segment

Distributed by African Media Agency (AMA) on behalf of Backbase.