Kenya becomes 10th African country to join centralized digital payment and settlement system PAPSS

By : Hikmatu Bilali

Date : lundi, 02 octobre 2023 15:05

The ongoing digital transformation has shown its potential to accelerate development across Africa. Recognizing that potential, most countries on the continent are embracing it to speed up the achievement of development goals.

Kenya has joined the Pan African Payments and Settlement System (PAPSS), Trade Cabinet Secretary Moses Kuria announced on X (formerly Twitter) on September 29.

According to the government official, the "Central Bank of Kenya has signed the instruments that have finally seen Kenya join the Pan African Payments and Settlement System (PAPSS)."

Kenya's participation in PAPSS is a significant step towards promoting smoother and cost-effective intra-African trade and enhancing economic collaboration across the continent.

The move further strengthens the African Continental Free Trade Area (AfCFTA) initiative as it enables Kenyan companies to settle trade transactions with other countries in the PAPSS network using local currencies.  

PAPSS, launched in January 2022, is a digital centralized payments and settlement system designed for intra-African trade. It is headquartered in Cairo, Egypt, and is overseen by African Central Banks. With more than 25 leading banks across Africa, including Ecobank, Zenith Bank, and Stanbic, connected to it, the system simplifies payment transactions. It enables companies to settle trade transactions in their local currencies, helping save on foreign exchange costs and the liquidity challenges companies would have faced if they were to rely on non-African correspondent banks for trade settlement.

The introduction of this system will help African nations save close to $5 billion annually in trade transaction costs.

Hikmatu Bilali


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