A new report by the African Union High Level Panel on Illicit Financial Flows (AU HLP) has raised red flags over vulnerabilities in mobile money and fintech systems, warning they could be exploited for money laundering and illicit financial flows (IFFs).
The African Development Bank (AfDB) estimates that Africa loses $580 billion annually or about $1.6 billion daily to IFFs.
Former AfDB President, Dr. Akinwumi Adesina, told Bloomberg that these leakages worsen the continent’s nearly $2 trillion debt crisis, draining much-needed resources for development.
According to him, the daily hemorrhage includes $90 billion in IFFs, $275 billion lost to profit-shifting by multinationals, and $148 billion through corruption.
The AU HLP report highlights that while mobile money and non-bank institutions, such as microfinance firms and fintechs have expanded financial inclusion, they also present systemic gaps.
Many mobile remittance platforms maintain settlement accounts abroad, creating opportunities to hide or launder illicit funds.
The GSMA’s 2025 State of the Industry Report revealed that mobile money surpassed two billion registered accounts globally in 2024, with over 500 million active monthly users and transaction values hitting $1.6 trillion.
Sub-Saharan Africa continues to lead adoption, contributing about $190 billion to GDP in 2023. Roughly 30% of adults in the region use mobile money, compared to a global average of just 13%.
Despite the sector’s economic impact, the AU HLP cautions that regulatory frameworks remain fragmented and poorly standardized across Africa.
With most cross-border trade now relying on electronic and mobile payment systems, regulators face new challenges in detecting and preventing illicit flows.
Remittances from Africans abroad, largely processed via mobile platforms add to the urgency for tighter oversight.
Without stronger regimes, the rapid digitization of Africa’s economy could entrench vulnerabilities and undermine progress in curbing IFFs.
The report added that, while progress has been made, significant national-level gaps persist, requiring regulators to balance innovation with safeguards against financial crime.
