Diffusion of Innovation vs. Dependence Theory: FinTech Inclusion in the AfCFTA Era

Abstract

The African Continental Free Trade Area (AfCFTA) aspires to accelerate digital financial integration across Africa, yet the diffusion of FinTech innovations shows uneven patterns shaped by deep-seated power structures. This study examines how FinTech adoption is spreading in AfCFTA member states and how structural dependencies influence this process, through the dual lenses of Diffusion of Innovation (DOI) theory and Dependency Theory. We employ a convergent mixed-methods approach, combining case studies of Kenya, Nigeria, Rwanda, and Egypt with quantitative analyses of open datasets (e.g. GSMA, World Bank Findex) and qualitative discourse analysis of policies. Our findings reveal that while mobile money and digital finance are being rapidly adopted – reaching one-third of adults in Sub-Saharan Africa on average – the benefits remain uneven and often constrained by external dependencies (foreign investment, technology, and data infrastructure). DOI theory helps explain how local innovations and social networks drive FinTech inclusion (for example, Africa hosts 12 countries where mobile wallets now surpass bank accounts), whereas Dependency Theory exposes persistent asymmetries such as reliance on foreign tech giants and capital. We argue that achieving digital sovereignty under AfCFTA requires addressing these structural challenges. Key contributions include a novel conceptual model of innovation diffusion under dependency constraints and actionable recommendations for policymakers, industry, and development partners. Implications: Without strategic interventions, FinTech’s promise to foster financial inclusion and intra-African integration may be undermined by digital neo-colonialism. However, with coordinated AfCFTA frameworks, capacity building, and localized innovation, Africa can harness FinTech for equitable growth.