SMEs the Main Beneficiaries of the Payment System
A new African payment system, the Pan-African Payment and Settlement System (PAPSS), recently went live in Ghana, setting the stage for its rollout across the continent.
The payment system — the brainchild of the African Union, Afreximbank and AfCFTA — is an attempt to reduce African countries’ dependence on the U.S. dollar.
Meanwhile, the same report suggests that the continent’s small-to-medium enterprises (SMEs) could be the main beneficiaries of the PAPSS system.
These savings, in turn, will enable the SMEs to scale as Mike Ogbalu, the CEO of PAPSS, explains.
“The commercial launch marks a significant milestone in connecting African markets seamlessly. It will provide a fresh impetus for businesses to scale more easily across Africa and is likely to save the continent more than $5 billion in transactions costs every year,” noted Ogbalu.
Just like Ogbalu, who insists that the new payment system could help the continent to save billions of dollars, Pamela Coke-Hamilton, an executive director at the International Trade Centre, claims the new payment system will help the African continent reduce barriers to trade that are faced by SMEs.
Enhanced Cross-Border Commerce
“ITC is preparing enterprises to benefit from PAPSS, creating new opportunities for growth in cross-border e-commerce and sustainable trade.”
The Techcabal report suggests that discussions about onboarding other African central banks are still ongoing.
