LAGOS - African banking revenues have topped $100 billion for the first time, with profitability well above the ​global average, McKinsey ⁠said, highlighting the sector's growing economic importance - and its concentration in a handful ‌of markets.

Banking revenues across the continent reached about $99 billion in 2024 and are estimated to ​have increased to $107 billion in 2025, the consulting firm said in a report on Monday.

Returns on ​equity stood ​at 19% in 2024 and are expected to ease to 17% this year, compared with a global banking average of about 10%.

Despite the ⁠growth, revenues remain heavily concentrated. Egypt, Kenya, Morocco, Nigeria and South Africa account for around 70% of Africa's total banking revenues, with South Africa the largest market, generating about $26.4 billion in customer-driven revenues in 2024.

The strong performance reflects a four-year period ​of favourable conditions ‌driven by high ⁠interest rates, loan repricing, ⁠and gains from foreign-exchange and trading activity, even as banks continue to face currency volatility ​and uneven macroeconomic conditions.

"African banking has moved decisively from ‌a story of potential to one of performance," said ⁠Mayowa Kuyoro, a partner and head of McKinsey's financial services practice in Africa.

On a constant-currency basis, banking revenues grew by around 17% a year between 2020 and 2024, far faster than the global average. In U.S. dollar terms, growth was more modest at about 5.2% annually, reflecting sharp exchange-rate swings across several markets.

Expansion has been underpinned by rising financial inclusion, rapid adoption of digital banking services and demand from a young and increasingly urban population. Africa's population grew ‌by more than 2% a year between 2020 and 2025, while ⁠the working-age population expanded by nearly 3% annually.

Lending ​remains the largest revenue pool and is projected to grow to about $52 billion by 2030, while small and medium-sized enterprises are expected to be the fastest-growing customer segment.

"The next ​phase of ‌competition will be defined by how banks scale digital capabilities ⁠and build revenue streams beyond traditional ​lending," Kuyoro said.

(Reporting by Isaac Anyaogu. Editing by Mark Potter)