Nairobi — KCB Group has entered into a deal with a pan-African payment platform to facilitate settlements of cross-border transactions on the continent.
This was agreed upon yesterday with the Pan-African Payment and Settlement System (PAPSS) on the sidelines of the AfreximBank Annual Meeting in Accra, Ghana.
PAPSS provides a secure and efficient channel for processing cross-border payments.
KCB Group CEO Paul Russo said the platform will guarantee speed, affordability, and reliability of transactions, effectively boosting intra-African trade and payments.
“With this agreement, we bring on board our payments and collections expertise spanning over 120 years,” Russo said.
“This means that our customers will now have access to vast economic opportunities that will deliver multiple advantages and efficiencies especially when conducting Intra-African trade payments.”
PAPSS is a centralized Financial Market Infrastructure developed in collaboration with the African Export-Import Bank (Afreximbank) to complement trading under the Africa Continental Free Trade Area (AfCFTA).
It provides an alternative to current high-cost and lengthy correspondent banking relationships to facilitate trade and other economic activities among African countries through a simple, low-cost, risk-controlled payment clearing and settlement system.
“As a Pan-African banking institution, it is our desire to play a bigger role in facilitating trade across Africa and beyond. With such partnerships, we shall be able to settle our own transactions including those for all its subsidiaries as well as for other commercial banks without many hurdles.” the CEO added.
The platform will deliver multiple advantages and efficiencies to intra-African trade payments, including a reduction in the duration and time variability of cross-border payments across Africa.
It also supports real-time payments, decreases the liquidity requirements of commercial banks for cross-border payments, and removes transaction value limits, among others.
Currently, at least eight Central Banks, 28 commercial banks, and six switches have signed up for the platform.
It has been successfully piloted in the six countries of the West African Monetary Zone and is expected to expand into the five regions of Africa before the end of 2023.
Additionally, all African Central Banks are expected to sign up by the end of 2024, and all commercial banks by the end of 2025.