PAPSS, the Pan-African Payment and Settlement System, has announced the signing of Memorandums of Understanding (MOUs) with five African multinational commercial banking groups: Access Bank Group, Ecobank Group, KCB Group, Standard Bank Group, and UBA Group.
These significant partnerships aim to revolutionise the settlement of cross-border transactions across Africa, leveraging on the vast network of subsidiaries and representative offices across major economic centres across Africa.
The MOUs were signed on 19 June 2023, at the opening ceremony of Afreximbank’s 30th Anniversary Celebrations and 30th Annual Meetings held in Accra, Ghana.
The signature of these MOUs signifies a big step forward in the pursuit of seamless cross-border trade payments throughout the almost 40 countries covered by the banks. The broad collaboration between PAPSS and African commercial banks will pave the way for enhanced efficiency, transparency, and reliability in intra-African settlement.
As part of the partnership, Access Bank Group, Ecobank Group, KCB Group, Standard Bank Group, and UBA Group will collaborate closely with PAPSS to ensure seamless integration of PAPSS into their existing systems. This collaborative effort will include opening up all their African footprints for PAPSS, facilitating settlement of transactions, encouraging the participation of fintech in PAPSS via the banks and expanding PAPSS to all the banks’ current digital channels such as mobile app banking and e-banking.
Professor Benedict Oramah, president of Afreximbank, comments: “the signature of these MoUs marks a remarkable step towards the realisation of the aspirations of Africa’s foreleaders, who envisioned the creation of a payment and clearing union about six decades ago. It also draws us closer to domesticating cross-border payments by enabling payments for cross-border trade in African currencies while strengthening African currencies.
“By leveraging on the vast continental coverage of these African commercial banks, PAPSS will seamlessly facilitate cross-border trade and payments and boost intra-African trade and investments.”
Wamkele Mene, secretary-general of the AfCFTA, says: “the introduction of the new PAPSS Model for onboarding African Commercial Banks and the signing of the MoUs with the five African commercial bank groups signifies a bold step towards the full operationalisation of PAPSS for the benefit of African traders and SMEs in the implementation of the AfCFTA agreement.”
Mike Ogbalu III, CEO of PAPSS, adds: “These partnerships with Access Bank Group, Ecobank Group, KCB Group, Standard Bank Group, and UBA Group mark a significant milestone in the journey toward a more integrated and efficient African banking landscape. By embracing PAPSS’ Commercial Bank Settlement Model, these banks are helping build a robust continental platform for fostering cross-border payments, thereby paving the way for financial inclusion and substantial continental economic development.”
The MOUs will be put into effect gradually in partnership with central banks in the countries where the five group banks operate. PAPSS and the banks will be working towards making this service available towards year-end.