The Pan African Payment and Settlement System (PAPSS) goes online

The Pan African Payment and Settlement System (PAPSS) developed by Afreximbank is a centralized payment, clearing and settlement system for intra-African trade payments that was adopted as the payment and settlement system to support the implementation of the African Continental Free Trade Area (AfCFTA) during the 12^th Extraordinary Session of the Assembly of the AU held in Niamey, Niger in July 2018 (Assembly/AU/Dec.1(XII)).

The PAPSS aims at facilitating the conversion of African currencies with each other in the context of trade transactions, without the need to first convert them in hard currencies such as the US dollar or the Euro, an operation that leads to long transaction times and to high transaction costs (due to the high commissions fees to be paid to correspondent banks for currency conversion) for African traders. Afreximbank estimates that such transaction costs are currently of about 5 billion USD per year. After being successfully piloted in some West African countries, the system is now ready for being rolled out at continental level. According to an Afreximbank communique issued on 28 September 2021, this will happen by integrating into the system National Payment Systems, Regional Payment Systems and other financial services providers in Africa.

PAPSS supports three core processes: 1) instant payment, 2) pre-funding and 3) net settlement.

Details on the functioning of these processes are available at the following link.