PAPSS Set for Expansion To Boost Intra-Africa Payments

The Pan African Payment and Settlement System (PAPSS) which was launched to make cross-border transactions seamless, is set to capture more markets in Africa.

The plan was disclosed last week by the Chief Executive Officer of PAPSS, Mr. Mike Ogbalu, during a stakeholders’ forum held in Lagos.

Ogbolu, who was represented, said Fintech across the continent of Africa can operate more seamlessly and widely with the assistance of PAPSS.

According to him, “Currently, there are numerous impediments and challenges facing intra-African trade payments. Banks must navigate sometimes conflicting local, multi-country and multiregional regulations to enable the seamless movement of funds on behalf of their diverse customers across the continent. Operational inefficiencies and onerous compliance requirements are time-consuming impediments.”

In his opening remarks, Mr. Patrick Akinwunta, Ex Ecobank Group Managing Director & Regional Executive at Ecobank Nigeria, said banks, their customers and anyone or business involved in financial transactions across the continent of Africa stand to benefit massively from the PAPSS system.

“The essence of PAPSS is to help in cross-border financial settlement with ease, speed and precision. It is a practical process of instant delivery and a major aggregator that brings everybody together. We all need a connecting point; and PAPSS is the big umbrella.

As a centralized Financial Market Infrastructure that enables the efficient flow of money securely across African borders, minimizing risk and contributing to financial integration across the regions, PAPSS works in collaboration with Africa’s central banks to provide a payment and settlement service to which commercial banks and licensed payment service providers across the region can connect as ‘Participants’.

In his presentation, Mr. Osita Ugwu, Chief Technology Officer at PAPSS, disclosed that 60 banks have already gone live on PAPSS platform, while another 60 are doing integration.

According to him, “By year end, we are expecting 23 banks to be integrated. As of today, 60 banks are doing integration and another 60 banks are going live.

Since its launch by the African Union and the Afreximbank in 2022, several commercial banks have been onboarded on its system.

PAPSS is a pan-African payment system facilitating instant cross-border payments in local African currencies. It is a centralised platform that connects central banks, commercial banks, and other financial institutions across the continent.

The platform was launched in January 2022 by the African Export-Import Bank (Afreximbank) and the African Union (AU). At launch, it was sold as a system that could reduce the cost and time of cross-border payments in Africa and boost intra-African trade. It has partnered with over 25 commercial banks since its launch and helps accelerate payment processing as a real-time gross settlement system.

The system also boosts security compared to the current correspondent banking system, as it operates on a centralised platform governed by the AU and Afreximbank.

At the event, PAPSS introduced a new settlement model called the Commercial Bank Settlement Model (CBSM), which allows commercial banks to open and fund their settlement accounts at Afreximbank and manage their liquidity as per their banking requirements.