https://en.sputniknews.africa/20250711/africas-new-payment-system-secret-weapon-against-dollar-dominance-1075427789.html
Africa’s New Payment System: Secret Weapon Against Dollar Dominance
Africa’s New Payment System: Secret Weapon Against Dollar Dominance
Sputnik Africa
In a strategic move to strengthen intra-continental trade, the African Union and Afreximbank are rolling out an organic (continent-wide) payment... 11.07.2025, Sputnik Africa
2025-07-11T17:35+0200
2025-07-11T17:35+0200
2025-07-11T17:35+0200
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Africa’s New Payment System: Secret Weapon Against Dollar Dominance
Sputnik Africa
In a strategic move to strengthen intra-continental trade, the African Union and Afreximbank are rolling out an organic (continent-wide) payment system—facilitating instant cross-border transactions settled in domestic currencies.
High cross-border transfer costs—up to 30 percent in correspondent-bank fees—have long hampered African small and medium enterprises (SMEs). The Pan-African Payments and Settlement System (PAPSS) tackles this by connecting central banks, commercial banks, and payment providers on a single platform for instant, local-currency settlement, slicing middlemen costs and accelerating payments.Beyond trade, PAPSS and related innovations like smart contracts and an envisioned “African Currency Marketplace” could create liquidity pools for direct currency exchange, streamline invoicing, and automate payments upon delivery. Such complementary tools, paired with digital-ID standards and telecom upgrades, will deepen interoperability and trust across the continent’s digital finance ecosystem.In a discussion with Dr. Olusegun Obasun—a seasoned banker and business consultant from Nigeria—African Currents examined the underlying reasons for launching an African payment system, its importance, and its potential benefits.Want to hear more from our guests? Catch the full conversation on the African Currents podcast, brought to you by Sputnik Africa.You’ll find our episodes not just on the website, but also on Telegram.► You can also stream our podcast on Apple Podcasts, Spotify, Deezer, Pocket Casts, Afripods, Podcast Addict.► Check out all the episodes of African Currents.
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Africa’s New Payment System: Secret Weapon Against Dollar Dominance
In a strategic move to strengthen intra-continental trade, the African Union and Afreximbank are rolling out an organic (continent-wide) payment system—facilitating instant cross-border transactions settled in domestic currencies.
High cross-border transfer costs—up to 30 percent in correspondent-bank fees—have long hampered African small and medium enterprises (SMEs). The Pan-African Payments and Settlement System (PAPSS) tackles this by connecting central banks, commercial banks, and payment providers on a single platform for instant, local-currency settlement, slicing middlemen costs and accelerating payments.
Beyond trade, PAPSS and related innovations like smart contracts and an envisioned “African Currency Marketplace” could create liquidity pools for direct currency exchange, streamline invoicing, and automate payments upon delivery. Such complementary tools, paired with digital-ID standards and telecom upgrades, will deepen interoperability and trust across the continent’s digital finance ecosystem.
In a discussion with Dr. Olusegun Obasun—a seasoned banker and business consultant from Nigeria—African Currents examined the underlying reasons for launching an African payment system, its importance, and its potential benefits.
"More and more African countries are realizing that we don't even need to depend on the US dollar to trade with ourselves. And to me, I think this is a sign that Africa is growing more confident in its own financial system [...]. Settling trade in local currencies strengthens African sovereignty and buffers it from external shocks that are linked to the U.S. monetary policy and dollar liquidity crisis [...]. So, when we trade in local currencies... it keeps value also within the African continent [...]. I think it's important that we recognize that the shift towards a local currency system is not anti-Western but pro-African and is rooted in the necessity of economic sovereignty and operational efficiencies," Dr. Obasun expressed.
Want to hear more from our guests? Catch the full conversation on the African Currents podcast, brought to you by Sputnik Africa.
You’ll find our episodes not just on the website, but also on
Telegram.► Check out all the episodes of African Currents. 
