Africa is building its own payment system. PAPSS could be a major game-changer in finance

For decades, trade in Africa was, paradoxically, easier with Europe or the United States than between certain some countries on the continent itself. Different currencies, difficulties with currency convertibility and the need to use international banks as intermediaries meant that a large part of the capital involved in trade between African countries was lost.

The Pan-African Payment and Settlement System (PAPSS) aims to change this situation.

The system was adopted by the African Union in 2019 as one of the instruments for implementing the African Continental Free Trade Area (AfCFTA), and it was officially launched in January 2022. It was designed by Afreximbank, in collaboration with the African Union and the AfCFTA.

An experiment that grew into a continental network

The PAPSS was initially primarily a West African project. Nigeria, Ghana, Gambia, and the other members of the West African Monetary Zone were among the countries where the first tests of this system took place.

However, the growth and adoption of PAPSS by additional banks has clearly accelerated. According to the African Trade Report 2025, by the end of 2024, the system included 16 central banks and 150 commercial banks. By the first nine months of 2025, the system had expanded to 19 countries, 150 commercial banks, and 14 national payment systems.

This year brought another breakthrough—countries from Central Africa began joining the system. In July 2026, the Bank of Central African States (BEAC), representing the six CEMAC countries—Cameroon, the Central African Republic, the Republic of the Congo, Gabon, Equatorial Guinea, and Chad—joined PAPSS.

Expanding the network is important because every new bank from another African country connected to PAPSS increases the system’s usefulness for others. This network effect could prove to be PAPSS’s most important strength.

Africa is building its own payment infrastructure

The system as a whole is not about immediately replacing the dollar or other non-African currencies. The PAPSS operates similarly to solutions that have been used in Europe for years. A company in one country can initiate a payment in its local currency, and the recipient in another country receives the funds in its own currency. PAPSS facilitates the process between participating institutions, reducing the need for an intermediary currency. The system is designed for instant or near-instant payments.

All of these benefits investors—less expensive currency exchange, faster access to funds, and reduced dependence on financial infrastructure located outside of Africa.

Afreximbank is developing another component of the PAPSS infrastructure

However, the system’s developers are not stopping at simply improving the payment process. There are also investments aimed at increasing the flexibility of payments in local currencies.

Afreximbank has undertaken to develop another component of the financial infrastructure—the African Currency Marketplace. In 2025, a platform was launched to enable the direct exchange of African currencies, and during the testing phase, transactions involving 12 African currencies were conducted.

Two financial problems that have been holding back African markets for years may now be resolved—PAPSS as a money transfer system, and the African Currency Marketplace as a way to simplify currency exchange.

According to Afreximbank’s estimates, existing currency barriers generate approximately $5 billion in transaction costs per year in Africa. If the new systems eventually reach all African countries, the entire continent could benefit.

PAPSS could become more than just a payment system
PAPSS’s biggest challenge in the coming years will not be perfecting the technology, but getting the market comfortable with using the new infrastructure. Banks and fintech companies must connect their customers to it, while businesses must begin to view payments in local currency just as naturally as transfers in dollars or euros.

PAPSS’s strength lies in connecting existing national and regional payment systems into a single network, rather than competing with them. Fewer intermediaries, lower settlement costs, and easier access to payments in local currencies could gradually change the way African companies trade with one another.

The strategy—it seems—is already working. According to Afreximbank data, PAPSS transaction volume increased by approximately 1,000% in the comparable period of 2026 compared to 2025, while the value of transactions rose by approximately 125%. Furthermore, the network now includes more than 30 African countries. PAPSS is connected to 24 central banks, as well as more than 200 commercial banks and payment service providers.