By Vivian Ihechu
Prof. Pius Olanrewaju, President and Chairman of the Council of the Chartered Institute of Bankers of Nigeria (CIBN), says one of Africa’s most pressing economic challenges is cross-border payment settlements.
According to him, this leads to Africa losing an estimated $5 billion annually to settlement inefficiencies associated with reliance on foreign currencies.
Olanrewaju spoke on Tuesday at the inaugural and official launch of the Pan-African Payment and Settlement System (PAPSS) Cowry conference on worldwide and regional payment in Lagos.
The forum was hosted by PAPSS, Afreximbank, AU and AFCFTA Scretariat, , spotlighting PAPSS as a game-changing solution to unify the continent’s fragmented financial ecosystem.
Olanrewaju noted that for decades, African businesses and individuals conducting intra-continental transactions had faced slow, costly processes, often relying on foreign currencies and external intermediaries.
“For too long, cross border payments within Africa has been very slow, costly and also dependent on foreign currency and external intermediaries.
“The system, designed without Africa’s unique economic realities in mind, has hampered regional trade and discouraged investment.
“The toll is severe. The urgency of our discourse today cannot be overemphasised.
“African loses an estimated $5 billion annually, settlement inefficiencies associated with reliance or non-Africa forex.’’
He stressed that these inefficiencies translated into higher costs and lost opportunities for the continent’s entrepreneurs, investors, and ordinary citizens.
In spite the creation of large-scale initiatives such as the African Continental Free Trade Area (AfCFTA), the impact had been muted by these barriers.
“Intra Africa trade remains at 18 per cent, one of the lowest regional trade figures globally,” the speaker stated, highlighting the urgent need for reform.
He noted that PAPSS was a Pan-African solution designed to address these very inefficiencies, aiming to move Africa away from dependence on foreign currencies for local trade.
“Since going live, PAPSS has expanded to 16 countries, collected over 150 commercial banks and enabled settlements in local currency within 120 seconds’’.
This signified a milestone for financial sovereignty and efficiency, marking a shift toward independence in the continent’s financial infrastructure..
“These are not just statistics. They are signals that Africa is building solutions rooted with its own realities,” the CIBN leader said.
He said collaboration was needed among stakeholders.
“This is the moment for policy makers, bankers and private sector leaders to run around, perhaps as a continental public…
“The collaboration between the charity of bankers of Nigeria and perhaps representing landmark in the evolution of Nigerian financial ecosystem.’’
Olanrewaju said involvement of central banks, fintech startups, and financial institutions was also imperative.
“Policy makers, financial institutions and fintechs and global partners can come together to imagine and build a truly sovereign and inter operate, operable African payment system.
“We recognise that payments are not just technical operations. They are instruments of sovereignty, competitiveness and us and continental unit.’’
Earlier, PAPSS CEO, Mr Mike Ogbalu, asserted that Africans must shape, control and direct their own payment systems.
He described the Cowry platform as a space created to network, share ideas and co-create payment solutions that speak directly to African realities, noting that 160 commercial banks, 19 countries, 15 switches and five fintechs have already adopted PAPSS.
According to Ogbalu, Cowry will serve as a central hub for conversations on global and regional payments, hosting events and conferences that bring together stakeholders across the ecosystem.
He said the platform represented a deliberate effort to ensure that Africa’s voice was not only heard but became influential in the global payments industry.
Also, Mr Emeka Onya, Director , Digital Banking, African Export-Import Bank (Afreximbank), highlighted the drive for sovereign payments’
“We need an African voice to drive the future of African players, and I think this is the first of many hours to come.”
“For us, what it means to be in sovereignty means that Africa controls the pipes.”
“We believe that payments should start in Africa and settle in Africa,” a guiding principle in Afreximbank’s approach to digital infrastructure.
“What we’ve done here is to build the mill, and now we’ve built the payment mill, we have created infrastructure to connect Africans together,” he added.
The ‘payment mill’ alludes to the growing digital backbone underway, connecting markets within Africa and to the world.
However, Onya cautioned that even the best system must follow implementation.
Also, central to scaling African trade, he said, trust and data were vital.
“We understand now that you can’t trade with our trust.
“Also, if you want to expand your business, you need data to do that.
“For instance, we’ve created a service, MANSA, which allows us to onboard and maybe provide information that allow us to profile KYC due to the jets of all counterparties you trade, and that we call the trust wheel,” he explained.
For inclusivity, Onya, emphasised an African marketplace where exporters, importers, logistics, and customs officials converged.
“We avoid exporters, importers and also terms like logistics, warehouses, customs officials, all in one ecosystem to be able to connect them to each other.
“The goal is a transparent environment where you get the same quality and same and same standard from countries in Africa are not working from the west.”
He noted that Afreximbank, recognising persistent challenges, over the past 30 plus years, had been financing Africa to transform trade.(NAN)www.nannews.ng
Edited by Kamal Oropo
