The Pan-African Payment and Settlement System (PAPSS) has signed Memorandums of Understanding with five African multinational commercial banking groups. Specifically, PAPSS announced the signing of Memorandums of Understanding (MOUs) with five major African multinational commercial banking groups, namely Access Bank Group, Ecobank Group, KCB Group, Standard Bank Group, and UBA Group.

The purpose of these partnerships is to modernise the process of settling cross-border transactions across Africa. This initiative seeks to utilise the extensive network of subsidiaries and representative offices in key economic hubs throughout the continent. The MOUs were formally signed on 19 June 2023 during the inaugural ceremony of Afreximbank's 30th Anniversary Celebrations and 30th Annual Meetings held in Accra, Ghana.

The event was attended by various Heads of State and Prime Ministers from both Africa and the Caribbean, as well as leaders of continental policy and governance institutions, along with international organisations. These Memorandums represent a step forward in simplifying cross-border trade payments within the nearly 40 countries encompassed by the aforementioned banks. The partnership between PAPSS and African commercial banks aims to enhance operational efficiency, transparency, and dependability in intra-African settlement.

Implementing PAPSS's advanced settlement model is expected to streamline procedures and empower businesses by providing a secure and technologically advanced platform for cross-border transactions. Within this collaborative effort, Access Bank Group, Ecobank Group, KCB Group, Standard Bank Group, and UBA Group will work closely with PAPSS to ensure a seamless integration of PAPSS into their existing systems. Comments from participating members Officials from Afreximbank commented on the significance of these MOUs, highlighting their role in achieving the vision of Africa's leaders who initially conceived the idea of a payment and clearing union about six decades ago.

This move also aims to bring cross-border payments into the realm of African currencies, strengthening them and promoting intra-African trade and investments. Officials from AfCFTA also expressed their views on the importance of these developments. They emphasised that the adoption of the new PAPSS Model for partnering with African Commercial Banks, along with the signing of the MOUs, represents a substantial step towards the operationalisation of PAPSS, which will ultimately benefit African traders and SMEs in alignment with the AfCFTA Agreement.

PAPSS officials talked about these collaborations and underscored the milestone achieved by working with the aforementioned banking groups. They noted that the use of PAPSS' Commercial Bank Settlement Model by these banks contributes to the creation of a robust continental platform for facilitating cross-border payments. This development is seen as a catalyst for financial inclusion and significant economic growth across the continent.

The implementation of these MOUs will be a gradual process carried out in collaboration with central banks within the countries where the five Group Banks operate. Customers of these banks across Africa will receive communication through their usual channels as soon as the service becomes available in their respective countries. PAPSS and the banks are working towards making this service accessible by the end of the year.

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