Limited digital literacy is the most significant obstacle preventing African consumers from adopting online banking services, according to a new report that underscores both the continent’s digital transformation potential and the risks of leaving millions behind.
The Africa Digital Banking Experience Series 2025, published by African Banker in collaboration with Backbase, found that 77% of surveyed banks view poor digital literacy as the single biggest barrier to rolling out digital platforms. The finding comes despite the rapid expansion of mobile money, which has familiarized millions with basic digital payments but left more advanced services underused.
The report highlights structural gaps. Only half of African countries currently include IT studies in school curricula, far below the global average of 85%, while levels of financial education also remain weak. This leaves many customers unable to navigate services such as digital lending, automated onboarding, and integrated banking ecosystems, tools increasingly vital for both financial inclusion and sector competitiveness.
Cybersecurity concerns (54.7% of banks) and limited internet access (51.6%) compound the problem, but banks stressed that digital illiteracy is the most pressing challenge. Without stronger skills and awareness, customers remain hesitant to embrace online transactions, reinforcing mistrust and slowing the pace of digital adoption.
Still, industry leaders see reasons for optimism. Falling data costs, expanded internet penetration, and growing exposure to mobile-based services are expected to gradually close the literacy gap. Banks anticipate that as users gain confidence with secure platforms, uptake of more sophisticated digital services will rise, supporting both customer inclusion and revenue growth.
The report calls for coordinated investment in digital and financial education initiatives, alongside efforts to expand affordable access. Progress on these fronts could unlock a new wave of innovation and competitiveness for African banks. By building consumer capacity, they say, financial institutions can not only broaden their market share but also accelerate Africa’s transition toward a more inclusive digital economy.
