This article is an excerpt from a policy brief that will be published in full on the ISTinaD Research Center website soon.
Financial Technology (FinTech) has emerged as a major global force rapidly transforming the financial sector and representing the latest evolution in financial services. FinTech is broadly defined as technologically enabled financial innovation.
Although the connection between finance and technology has a long history, the current era emerged after the 2008 Global Financial Crisis, driven by new market entrants such as technology start-ups and the widespread use of smartphones.
This phenomenon is significant for developing countries, where its growth is mainly fuelled by the goal of economic development. FinTech leverages technology and drives financial inclusion by making services significantly faster, cheaper and more accessible, with digital solutions already cutting key transaction costs (such as cross‑border payments and remittances) by nearly half.
War has led to the destruction of major data centres and the collapse of traditional banking functionality, forcing citizens to rely on digital services like the Bankak app.
Financial inclusion in Sub‑Saharan Africa has expanded rapidly, driven largely by mobile money, with formal account ownership rising from about 20% to over 50% in the past decade hence positioning FinTech as a key enabler of this growth.
In Sudan, the ongoing war has led to the destruction of major data centres and the collapse of traditional banking functionality, forcing citizens to rely on digital services like the Bankak app (See Box 1), which has become a dominant transaction channel. However, progress is hindered by low Internet penetration (recorded at 30.9% in 2022) and a regulatory environment that is surrounded by obstacles such as low financial awareness and digital identity challenges.
Box 1: Bankak the Mobile app from the Bank of Khartoum, which offered P2P transfers, remittances, and bill payments, with over 7 million users. Before the cash crisis in 2018, the bank put a big effort into getting people to sign up for the app. It was initially targeting the unbanked and facilitating app registration through mobile phone numbers (E-wallets). The campaign was centred on offering 50 SDG when signing up. The advent of the cash crisis accelerated app usage. Today, it’s widely used by almost all big merchants. Post-war, Bankak remains the overwhelmingly widest choice for moving money and remittances, demonstrating digital resilience and market relevance.
The banking sector and the shaping of digital payments
The Central Bank of Sudan (CBoS) is the main regulator whose roles include licensing and supervising providers of e-payment services. The CBoS created an incentivising environment in 2016 and licensed more than 64 FinTech organisations, legitimising the sector and enabling private firms to participate in distributing payment infrastructure. However, the legal framework remains fragmented and outdated.
War caused EBS to lose access to critical systems, exposing shortcomings in its disaster recovery measures.
Then there is the Electronic Banking Services (EBS) that was created in 1999 to serve as the technical arm of CBoS. EBS is a partnership between CBoS (49 per cent), Sudatel (30 per cent) and commercial banks (21 per cent).
Historically, EBS played a crucial role in the development of the digital payment infrastructure in Sudan by serving four main functions.
Firstly, EBS was managing the national switch, which enables operations among local banks, holding the Society for Worldwide Interbank Financial Telecommunication (SWIFT) license -for international transactions, inter-bank settlements, as well as enabling mobile payment transactions.
After the outbreak of war in April 2023, EBS lost access to critical systems, highlighting an issue of inadequate disaster recovery measures. While some were restored, others, specifically, clearing services oversight, remain unresolved, revealing the system as a single point of failure. Also, more recently, CBoS has assumed direct oversight for monitoring and auditing the national switch transactions, while EBS carries on the operational aspect of it. Moreover, EBS’s monopoly over mobile money operations has ended as the market opens to private actors; EBS must now compete in this area against new players, including joint ventures between Zain/Faisal Islamic Bank and Sudani/Gulf and Africa Bank.
In terms of the main service providers for digital payments, the market is still dominated by commercial banks. Commercial banks were estimated at around 38 licensed institutions in 2021; 30 of these banks were relying on EBS for their e-payment services while the biggest five, Bank of Khartoum, Omdurman National Bank, Faisal Islamic Bank, Al Salam Bank and Al Baraka, owned their own private switches. Nevertheless, all licensed banks must adhere to mandatory interoperability configurations for services such as inter-bank settlements that pass through EBS.
A number of positive steps have been taken by EBS to ensure interoperability between the different FinTech actors. The enabling of Basic Bank Account Number (BBAN) payments between different banks has been crucial in responding to the cash crisis created during the note change in 2024/25 that has limited cash circulation to an all-time low. Also, EBS is currently attempting to include mobile money transactions through the BBAN system.
Map of Key Actors in FinTech
However, regional interoperability that trade blocs are developing across the continent is an area in which Sudan remains absent. For instance, the African Union’s initiative for the African Continental Free Trade Area ((AfCFTA)) has progressed on several axes, such as the AfCFTA Digital Trade Protocol and the Smart Africa e‑Payments Blueprint, but Sudan remains one of the few countries, actually just five countries, that have not ratified the AfCFTA agreement.
With only 15 percent of adults banked before the war, digital applications tied to formal accounts structurally excluded the remaining 85 percent of the population.
The traditional Sudanese banking sector played a critical but contradictory role in the development of FinTech and digital payments before the war, simultaneously laying foundational digital systems while imposing structural constraints that favoured established, urban, and banked populations. This was evident in the slow expansion of mobile money services, typically offered by telecommunication companies through mobile numbers, without requiring bank accounts or smartphones for transactions. Because only 15 per cent of adults were banked pre-war, digital applications tied to formal accounts structurally excluded the remaining 85 % of the population.
The slow adoption of mobile money services
CBoS regulations have been updated since 2021 to allow telecom companies to provide financial services through the establishment of independent financial vehicles in partnership with one or more banking institutions. The move was positively received and translated into a more visible deployment of mobile payment services, particularly from MTN through its service MoMO and the recent announcement of Sudani’s upcoming service in partnership with Gulf and Africa Bank. However, the broader disruption to telecom infrastructure due to the war has significantly slowed these efforts down.
A major hurdle for the adoption of mobile money services that became part of the daily life in neighbouring countries is the establishment of agents’ network as this network is what enables the cash-in/cash-out transactions that promote the wider adoption of e-payment solutions. And as has been proven from regional experiences, the agents are the most important actors for services such as mobile money, as they function as a mini bank at the customers’ doorstep.
Banks and telecom companies failed to incentivise cash-in/cash-out agents for formal mobile money. Agents earned higher, unregulated commissions of between 10 and 50 per cent from informal airtime credit transfers, which crippled the expansion of formal agent networks. Even with the entry of telecom companies, they have been unable to fully capitalise on their extensive agent networks, as profit margins from standard cash-in/cash-out fees remain comparatively unattractive. Consequently, agents often redirect their liquidity toward other economic activities that offer higher investment returns.
In conclusion, the digital payment landscape in Sudan remains an exclusive one with the slow progress of mobile money adoption where digital payment remains largely dependent on banking Apps like Bankak and Fawry, restricting adoption to a small minority of the population. Moreover, issues around digital identity, disaster recovery plans, data protection laws and interoperability between banks and telecom companies should all be addressed within a comprehensive regulatory framework for the sector to catch up with best practices and regional counterparts.
Box 2: Kenya: A private-sector-led model and the Challenge of Public Trust
Kenya’s journey is defined by the remarkable success of the private sector-led M-Pesa mobile money system. Launched by a telecommunications company, M-Pesa filled a critical gap in a country with limited physical banking infrastructure, driving financial inclusion and proving remarkably resilient during crises. Its stability is anchored in a secure financial structure where all customer funds are held in ring-fenced trust accounts, inaccessible for lending or investment.
However, Kenya’s experience also offers a stark cautionary tale regarding state-led initiatives. The government’s costly attempt to launch a national digital ID system, Huduma Namba, failed. After an estimated cost of $72-115 million, the programme was suspended by the High Court of Kenya due to significant data protection concerns and a profound lack of public trust, demonstrating that technological implementation without citizen buy-in is destined to fail.
