Payment platform under AfCFTA goes live in African Central Banks

Six central banks under West African Monetary Zone sign unto PAPSS

AfCFTA secretariat located in Ghana, West Africa

Bawumia launches Pan-African Payments System

The platform seeking to facilitate payments under the Africa Continental Free Trade Area (AfCFTA) has gone live a Central Banks in Africa.

Already, the system has been installed by all six Central Banks in the West African Monetary Zone including Ghana.

Known as the Pan African Payment and Settlement Systems, the platform is expected to boost transactions and save the continent about US$5 billion in the cost of trade-related transactions.

Speaking at the launch of the platform in Accra, Chief Executive Officer of PAPSS, Mike Ogbalu assured traders that they will rake in the benefits of the platform substantially.

“The system we have built is an infrastructure that will require third-party interactions, so we may need even mobile money agents and other payment channels. By this way, traders can transact without necessary going to the banks when they need to send cash to other countries” Ogbalu explained.

Solomon Quaynor, Vice president of the Africa Development Bank in his remarks intimated that the payment platform will significantly boost intra-regional trade under the pact.

“As a development bank for the continent, we are proud of the success story for this journey today and hope that it will benefit all Africans. The new payment system is critical to our quest to boost intra African trade and reduce cost of doing business for Africans which has been an impediment for some time now” he noted.

Ghana’s Vice President, Dr. Mahamudu Bawumia in his speech called on all African Central Banks to switch to the platform.

“It will be prudent for all Central Banks to allow their national switches to be linked to the system so that we don’t have to go in for individual banks to be hooked”, Bawumia stressed.

PAPSS is being developed in collaboration with the African Export-Import Bank, Afreximbank which seeks to facilitate payments as well as formalise some of the unrecorded trade due to the prevalence of informal cross-border trade in Africa.

The system will also provide an alternative to current high-cost and lengthy correspondent banking relationships to facilitate trade among member countries of the free trade pact.