ABA Editorial · Feb 11, 2026 · 12 min read
The African BNPL market is projected to grow from USD 5.2 billion in 2025 to USD 16.8 billion by 2031 at a 20.7 percent CAGR. Lipa Later partnered with Mastercard across Kenya, Rwanda, Uganda, and Nigeria in August 2023. Jumia Nigeria integrated CredPal and Easybuy in May 2024. Safaricom launched Faraja BNPL in Kenya. Inside the players, the regulatory tightening, and why CDcare's save-now-buy-later model reflects the economic reality that traditional BNPL struggles to work in Africa.
According to the Q1 2026 Africa Buy Now Pay Later Business and Investment Opportunities Databook published by ResearchAndMarkets in January 2026, the African BNPL payment market grew at a compound annual growth rate of 30.5 percent between 2022 and 2025, reaching approximately USD 5.2 billion in 2025. The same research forecasts the market will grow at a 20.7 percent CAGR between 2026 and 2031, reaching approximately USD 16.8 billion by the end of 2031. Those are large numbers for a product category that barely existed in Africa five years ago. This is a market report on the African BNPL sector in 2026, the operators that dominate it, the regulatory shift underway, and the emerging save-now-buy-later counter-model that has begun to challenge the underlying economics of classic BNPL in African markets.
The Q1 2026 Africa BNPL Databook and earlier reports identify four regional fintechs as the central operators in the market.
Lipa Later, founded in Kenya, offers consumer credit up to KSh 500,000 with up to 12-month payment plans. Its partnership with Mastercard, announced in August 2023, expanded Lipa Later into Kenya, Rwanda, Uganda, and Nigeria simultaneously. During 2024, Lipa Later extended into sector-specific offerings in healthcare and education financing. The company is one of the few African BNPL operators to have built genuine pan-African scale through a single brand and product.
Payflex, the leading South African BNPL operator, offers interest-free payments over a six-week term (the classic four-payment split familiar from Klarna and Afterpay in developed markets). Payflex is particularly strong in South African fashion and electronics retail, both online and offline, and has strengthened partnerships with both major e-commerce and physical retailers through 2024 and 2025. Payflex also introduced BNPL products aimed at small businesses in 2024 to improve their access to flexible payment solutions.
valU, a subsidiary of Egyptian financial services conglomerate EFG Hermes, is the dominant BNPL operator in Egypt and one of the most mature consumer credit platforms in North Africa. valU offers longer-term installment plans than typical BNPL and competes directly with MNT-Halan and Sympl in the Egyptian consumer credit market.
CredPal is the leading Nigerian BNPL operator, focused on digital integration across both online and offline retail ecosystems. In May 2024, CredPal partnered with Jumia Nigeria alongside Easybuy to offer installment payments at checkout, allowing consumers to spread payments while Jumia's merchants receive funds upfront. This is the classic BNPL merchant economic model: the operator takes credit risk, the merchant gets paid at transaction time, and the consumer pays over time.
An insightful analysis published by Afridigest in an interview with CDcare CEO Tobi Odukoya captured the economic challenge facing classic BNPL in African markets. Odukoya argued that BNPL profitability depends on the ratio of retail margin to interest rate. "In America and other markets where BNPL is popular, the ratio is above 1, while for most African markets the value is below 1. Wherever the value is below 1, BNPL providers will struggle to cover operational costs and service their debt." In simpler terms, African retail margins on the goods being financed are often thin, while the cost of funding the credit is high (because commercial debt in naira, cedi, or other local currencies is expensive), so the BNPL operator's margin gets squeezed from both sides.
This is part of why several African BNPL operators have partnered with larger players (Mastercard, Jumia, Safaricom) rather than trying to scale as standalone consumer brands. Partnership-led distribution cuts customer acquisition costs, which is the largest controllable expense for a standalone BNPL. Mastercard's collaboration with Lipa Later and Jumia's partnerships with CredPal and Easybuy illustrate the pattern.
CDcare, founded in Nigeria and participating in the ARM Labs Lagos Techstars program, built a different model specifically designed for the African economic reality. Instead of lending to customers upfront, CDcare operates a save-now-buy-later (SNBL) model. Customers save weekly or monthly toward a target item (an appliance, a phone, a laptop). Once the customer has saved 50 percent or more of the purchase price, CDcare delivers the item and collects the balance. The customer gets the item before full payment but after meaningful upfront commitment, which dramatically reduces default risk.
CDcare also differs from typical SNBL operators in how it sources inventory. Rather than partnering directly with brands and earning commission, CDcare works with wholesalers and distributors to acquire inventory at low prices and generates revenue from retail markup. According to Odukoya's Afridigest interview, over the 12-month period from February 2022 to January 2023, CDcare sold USD 6 million worth of goods at gross margins of 10 to 15 percent and a default rate of just 0.4 percent, with no external debt raised. For a credit-adjacent business in a high-rate African market, those are remarkable performance figures.
Other SNBL operators in Africa include FlexPay (Kenya, which received an investment from acasia and previously participated in the Barclays Cape Town Techstars program), Tunzaa (Tanzania, participated in the Startup Wise Guys accelerator), and LayUp (South Africa, participated in the Barclays Cape Town Techstars program). The emergence of SNBL as a distinct category reflects a recognition that African consumers, according to Odukoya, "would rather save than borrow," and that a product aligned with that preference has structural advantages over one that fights against it.
The most significant 2025 development in African BNPL was the embedding of BNPL into mobile money ecosystems. In Kenya, Safaricom partnered with fintech EDOMx to launch Faraja, a BNPL product that allows customers to pay later for purchases at merchants accepting Lipa na M-Pesa. Merchants receive full payment upfront; customers repay Faraja over time. This is distribution through an existing trusted channel (M-Pesa) rather than through a standalone BNPL brand, and it has the potential to reach scale that standalone operators cannot match.
Similar patterns are emerging in other markets. M-Kopa, which started as a pay-as-you-go solar home system financier, has extended into smartphone and other asset financing. The M-Kopa model (pay a daily or weekly installment, lose access to the device if payments stop) is effectively a collateralized BNPL for essential goods, and it has proved durable across Kenya, Uganda, Nigeria, and Ghana.
The fastest-changing element of the African BNPL sector in 2025 and early 2026 has been the regulatory environment. Across the continent, regulators have moved to extend consumer credit frameworks applicable to traditional digital lending to also cover BNPL. The emphasis has been on licensing, standardized disclosures, creditworthiness assessments, complaint handling, and data-sharing obligations. BNPL providers are increasingly subject to rules similar to those governing other consumer credit institutions.
Nigeria's Federal Competition and Consumer Protection Commission (FCCPC) introduced new oversight of digital credit providers through the Digital, Electronic, Online, or Non-Traditional Consumer Lending Regulations 2025, which explicitly apply to BNPL operators. Kenya's Central Bank tightened its Digital Credit Provider framework. Morocco's Bank Al-Maghrib issued formal authorization requirements and Alya became the first BNPL operator to receive one in 2024. South Africa, with its more mature consumer credit framework, already had regulatory tools to apply to BNPL but has been refining their application. The net effect is that standalone small BNPL operators are finding compliance burdens harder to absorb, pushing the market toward consolidation around well-capitalized players with omnichannel distribution.
Three things. First, whether mobile-money-embedded BNPL (Faraja in Kenya, M-Kopa across multiple markets) takes market share faster than standalone operators can respond. Second, whether save-now-buy-later operators like CDcare can scale beyond the USD 6 million-plus range into meaningful market share, or whether the model remains a niche within the broader consumer credit ecosystem. Third, whether the regulatory tightening consolidates the market around three or four continental winners, or whether each country develops its own national champion with limited cross-border reach.
The longer-term observation is that African BNPL is not a copy of the Klarna or Affirm playbook. The economics are different, the consumer preferences are different, and the regulatory environment is catching up faster than Western BNPL operators experienced at the same stage of development. The operators who adapt their business models to African economic reality, rather than importing Western templates, will be the ones still operating in 2030.
This report draws on the Africa Buy Now Pay Later Business and Investment Opportunities Databook Q1 2026 Update (January 2026) published by ResearchAndMarkets and cited by Yahoo Finance and Ecofin Agency; the Q3 2025 Update of the same databook (November 2025); FinTech Futures coverage of the Africa BNPL Market Report 2025; Afridigest's save-now-buy-later feature and interview with CDcare CEO Tobi Odukoya; Trustonic reporting on African smartphone BNPL; Mono open banking coverage of BNPL credit assessment; and public communications from Lipa Later, CredPal, Payflex, and valU.