Nigeria is taking a major leap toward seamless intra-African trade.The Central Bank has now directed all commercial banks to integrate the Pan-African Payment and Settlement System, or PAPSS, into their operations.Nigeria, which had Africa as its largest export destination in 2024, stands to benefit significantly. According to Afreximbank, PAPSS could save over 22 billion US dollars a year in currency conversion fees for African traders.
The Pan-African Payment and Settlement System (PAPSS) welcomed the new circular from the Central Bank of Nigeria (CBN), announcing a significant streamlining of documentation requirements for PAPSS transactions in Nigeria.This progressive policy, sets the stage for faster, more cost-effective, and more inclusive participation by Nigerians and Nigerian businesses, especially Small and Medium Enterprises (SMEs), involved in intra-African commerce under the African Continental Free Trade Area (AfCFTA).According to Afreximbank, PAPSS could save over USD22 billion a year in currency conversion fees for African traders.
« You don’t need the dollar anymore to intermediate, you don’t and that saves a lot of money, and it saves time as well, because the transaction here can be instant…and countries like China that are doing currency swap with us, we should embrace, because that also reduces our dependence on dollars. »
KEN IFE, Financial and Regional Trade Economist – Nigeria
With the new announcement, individuals and businesses in Nigeria will now be able to make PAPSS transactions efficiently; with less delays occasioned by paperwork. Ebere Empere launched her seafood export business in 2021, successfully reaching markets in the UK and US. But expanding to nearby African countries has been more difficult than reaching Europe or America.
« Because of the payment challenges when we try to ship to other African countries, we are not able to. There’s no encouragement to want to trade continentally ».
EBERE EKPERE, Entrepreneur – NIGERIA
While challenges like limited local production and currency fragmentation persist, Nigeria’s push to embrace PAPSS could mark a turning point in its regional trade outlook.
