Millions of semi-formal small and micro-African businesses are to benefit from opportunities in the African Continental Free Trade Agreement (AfCFTA) as MFS Africa, a digital payments network, has announced that it has joined the Pan-African Payment and Settlement System (PAPSS) network.

PAPSS is the newly established African cross-border and financial market infrastructure facilitating the payment, clearance and settlement for intra-African trade payments.

The synergy would enable MFS Africa to extend the reach of the PAPSS network to over 320 million mobile money and last mile users across 35 African markets, enabling borderless and seamless possibilities for transactions and trade.

Founder and CEO of MFS Africa, Dare Okoudjou, said borders do not limit Africans and that money should not be either.

He noted that the collaboration marks a new phase in driving the transformational potential of the AfCFTA.

According to him, the interchangeability of African currencies is still very limited decades after independence, meaning that intra-Africa trade often relies on hard currencies, hampering the growth of intra-African trade and the continent’s economy.

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He pointed out that by making cross-border payments affordable and easier, PAPSS would give small and medium-sized enterprises (SMEs), entrepreneurs and traders, easier access to the formal payments services.

Chief Executive Officer of PAPSS, Mike Ogbalu, described Africa as the global leader in mobile money services. He said a recent study found that 64 per cent of the daily global transactions through mobile money platforms in 2020 happened in sub-Saharan Africa.

According to him, this demonstrates how mobile money services play a key role in the economic growth of the continent and facilitate financial inclusion.
To that end, he noted that partnering with MFS Africa will open the way to millions more cross-border mobile money transactions and mark a new phase in driving the benefits of the African Continental Free Trade Area.

In addition, he said the PAPSS will be the enabling infrastructure that would spur the growth of intra-African trade and commerce, with the active participation of central banks, financial institutions, regional economic communities, the private sector and other stakeholders.

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He disclosed that over 80 per cent of African cross-border transactions originating from the continent’s banks are currently cleared and settled offshore, creating inefficiencies, and increasing the cost of African cross-border payments.