On January 13, 2022, the Pan-African Payment and Settlement System (PAPSS) was officially launched in West Africa. Despite its impressive benefits, this innovative solution is yet to be widely adopted. 

 On Monday, May 29, Kenya’s President, William Ruto (photo) called on his peers to take action for the widespread adoption of the Pan-African Payment and Settlement System (PAPSS). He asked them to encourage central and commercial banks to join the system. The official made the call during the  African Private Sector Dialogue on the African Continental African Free Trade Area (AfCFTA) held in Nairobi. 

 “It is also imperative that we proactively seek a resolution to the disparities in currencies and the consequential impediments it poses to intra-African trade. Trade cannot take place without efficient and unified payment systems. [...] There is a mechanism where all our traders can trade in the local currency and we leave it to the Afreximbank to settle all the payments. We do not have to look for dollars; our businessmen will concentrate on moving goods and services and leave the arduous task of currencies to Afreximbank,” he said. 

The PAPSS was launched in January 2022, one year after the operationalization of the AfCFTA.  It aims to link African markets, enabling instant cross-border payments in local African currencies, whether for purchases, money transfers, salary payments, share trading, or high-value commercial transactions.  According to Ghanaian President Nana Akufo-Addo, PAPSS is expected to save Africa 5 billion a year in payment transaction costs. However, most African countries are yet to embrace that innovative system. To date, only nine central banks, 40 commercial banks, and four switches have joined the PAPSS network.

For William Ruto, it is therefore urgent to take the first steps to get rid of the US dollar and mobilize for the adoption of PAPSS. 

Samira Njoya