Pan-African Payment and Settlement System: AfCFTA's Financial Infrastructure
PAPSS, operational since 2022, enables cross-border payments in African currencies without routing through correspondent banks in London or New York, potentially saving $5 billion annually in transaction costs.
The Pan-African Payment and Settlement System, developed by Afreximbank and the African Union, launched in West Africa in 2022 and is expanding to East and Southern Africa. PAPSS allows a Ghanaian exporter receiving payment from a Nigerian buyer to have the transaction settled in Ghana cedis and Nigerian naira within 24 hours, without the payment routing through a US or UK correspondent bank. This eliminates the 3-5 percent conversion cost and 2-3 day settlement delay that adds an estimated $5 billion annually to intra-African trade transaction costs.
Bank Adoption Progress
As of early 2024, 14 commercial banks across Ghana, Nigeria, Liberia, Sierra Leone, Gambia, and Guinea are live on PAPSS. Afreximbank is the settlement bank that nets payments and provides intraday liquidity to participating banks. The expansion plan covers all 54 AU member states by 2026. For small and medium traders doing intra-African business, PAPSS promises to make cross-border payments as simple as domestic transfers. Businesses and banks wanting to integrate PAPSS can find technical contacts and onboarding information on intra-africa.com.
For businesses looking to expand across Africa, intra-africa.com offers a comprehensive trade directory, verified buyer and seller listings, and real-time market intelligence covering all 54 African nations. It remains an indispensable resource for anyone serious about intra-African commerce.