Nigeria trails South Africa, Kenya in Africa’s B2B payment revolution

By Cynthia Ezekwe.

A new report from Duplo, a business-to-business (B2B) payments platform for African businesses of all sizes, has disclosed that Nigeria trails South Africa and Kenya in the development of key B2B payment processes across Africa, including adoption of electronic bank transfers, speed of processing invoices and payment automation.

The B2B payment platform made this known in its recent report tagged “Exploring the State of B2B Payments in Africa,’’ which includes the surveyed opinions of more than 1,200 professionals from Kenya, Nigeria, South Africa and Ghana.

Data from the survey disclosed that South Africa leads the way in electronic bank transfers, with 49.1 per cent choosing it as their preferred way to pay vendors, followed by Nigeria,Ghana and Kenya at 48.5 per cent,34 per cent,and 31.9 per cent respectively.

The B2B payments report noted that Kenya leads the way in payment automation, with 83.4 per cent of Kenyans stating that their payment system was either semi-automated or fully automated, compared to Nigeria at 79.9 per cent, South Africa at 71.69 per cent, and Ghana at 67.23 per cent.

The report pointed out that Africa’s B2B payment sector represents a significant, yet largely untapped opportunity, noting that it is partly due to the complexity and larger transaction volumes associated with B2B payments.

According to the World Bank, the continent’s share of the global B2B payment opportunity stands at $1.5 trillion. However, despite this promising potential, many businesses grapple with considerable payment delays and other issues with their payment processes that negatively impacts their cash flow and slows their growth.

The report noted that in recent years, digital payments solutions have eased many of the payment challenges. However, there are still a number of issues to be addressed in the journey of easing the flow of money between businesses in Africa.

In light of the above, security ranked as the most critical feature across the board for respondents when choosing B2B payment software, with 35.89 per cent selecting it as the feature they valued the most.

Across individual countries, security was also the top feature, as Kenya accounted for 39.9 per cent, Ghana (36 per cent), South Africa (35.6 per cent) and Nigeria (32.2 per cent), emphasising the importance companies attach to safeguarding their financial data. Functionality and ease of use (17.6 per cent), multiple payment options (13.5 percent) and speed (12.9 percent) follow, showing a preference for payment flexibility and quick transactions. Pricing (11.5 percent) and scalability (8.2 percent) are less prioritised, suggesting a focus on functionality and immediate needs.

Commenting on the report, Yele Oyekola, CEO and co-founder of Duplo, stressed that despite various challenges, the future of B2B payments in Africa is set for dynamic growth and innovation, signalling a new era of opportunities and expansion for the continent’s business ecosystem.

According to Oyekola, the opportunity to automate accounts payable and receivable and transform other aspects of the B2B payments process offers great potential to reduce payment delays, enhance cash flow and drive growth for businesses across the continent.’

The Duploo CEO also stated that the increased adoption of digital solutions implies a shift in workplace dynamics and positions finance professionals to add more value to their organisations.

“We are looking forward to playing a major role in the realisation of these opportunities and the delivery of technology solutions to support growth for businesses in Africa,’’ Oyekola added.